U.S. regulators approve bitcoin exchange-traded funds

Tokyo, Oct 18 Reuters - Bitcoin hovered near six-month highs on Monday in anticipation of the listing of the first futures-based bitcoin exchange-traded funds ETF in the United States, which investors hope will boost cryptocurrency trading volumes.

If the U.S. Securities and Exchange Commission is not opposed to a filing, the ProShares Bitcoin strategy ETF commences a 75-day period since the fund manager filed plans and could begin trading on Tuesday afternoon.

In the coming days and weeks, further crypto investment managers could list Bitcoin ETFs and that could lead to wider investment in digital assets.

The world's largest cryptocurrency ruled near $62,288 above Thursday's six-month high of $62,944 and not far from its all-time high of $64,895 in April.

Ether, another popular token used on the Ethereum blockchain, was traded around $3,866 and has been growing in tandem with bitcoin since mid-September.

The news of a suite of futures trading ETFs is not new to those following the space closely and to many this is a step forward but not the game-changer that some are sensing, said Chris Weston, head of research at Pepperstone in Melbourne, Australia.

We've heard by a spot ETF before and this may need more work on the regulation front. Among fund managers who have applied for legalization of bitcoin ETFs in the United States are the VanEck Bitcoin Trust, ProShares, Invesco, Valkyrie and Galaxy Digital Funds.

The Nasdaq announced the listing of the Valkyrie Bitcoin Strategy ETF on Friday. The world's largest digital currency manager is planning to convert its flagship product, the Grayscale Bitcoin Trust into a spot bitcoin ETF, CNBC reported on Sunday.

After months of back-and-forth between the SEC and potential bitcoin futures ETF issuers, it appears prepared to greenlight a handful of filings that would open the door to wider access to cryptocurrencies for retail and institutional investors alike.

Under the rule set employed by the ETF issuers, the SEC does not have to give explicit approval to the ETFs which can be launched at the end of a 75 day period if the U.S. regulator has no objections.

Cryptocurrency investors anticipate the approval of the first U.S. bitcoin ETF to trigger an influx of money from digital players who cannot invest in institutional coins at the moment.

Rising global inflation worries have also increased appetite for bitcoin, which is in limited supply, in contrast to ample amount of currencies issued by central banks in recent years as monetary authorities print money to stimulate their economies.

While the market is booming in the past, unlike its previous rallies there doesn't seem much exuberance in the market. A growing number of investors are starting to think inflation may not be temporary, and it is possible that Bitcoin is being chosen as a hedge against inflation, said Makoto Sakumra, researcher at NLI Research Institute.