CEO, president, and chairman of the Chicago Board Options Exchange (CBOE) Ed Tilly has claimed that, in order for Wall Street and other large institutional investors to enter the crypto markets, there must be Bitcoin exchange-traded notes (ETNs). Business Insider initially reported on Tilly’s remarks on January 18th.
In the Business Insider article, Tilly stated:
“The growth of Bitcoin in listed markets is still hamstrung by the lack of a trading product geared toward mom-and-pop investors.”
He went on to explain that Bitcoin futures did not catch because they are not accessible to retail traders, both in terms of their complexity and possible trading restrictions on customer accounts, since it is more sophisticated product that my require them to receive further clearance by the trading platform.
The article goes on to say futures and exchange-traded notes are important for bringing Wall Street investors into the crypto space
As Tilly explained in the article, ETNs are more accessible to retail traders as opposed to futures because it lowers the barrier to entry. He went on:
“The power of having that future there is also having an ETN that is more attractive to retail, and then institutions can lay that risk off on the listed futures market…. Absent that leg and introducing trackers or notes, I think we will be in this, ‘It trades every day, but it is not the story.’”
The reason, according to Tilly, why regulators have not yet approved a Bitcoin ETF (exchange-traded fund), which would track the price of Bitcoin and make it more accessible to everyday investors, is that regulators are unable to protect investors from manipulation, wince they do not have any control of the market, unlike with the traditional stock markets, for example, which are highly regulated.
“You answer that question,” said, Tilly, “You get your first ETN.”