The proposed BONK ETP — probably the primary ever meme coin exchange-traded product — may bridge the hole between crypto traders and Wall Road.
Bonk eyes Wall Road
Bonk (BONK), a high meme coin constructed on Solana (SOL), has introduced plans to launch an Change Traded Product in the US.
A core developer for Bonk, Nom, revealed the information at Solana’s Breakpoint occasion, which befell on Sept. 20-21. The meme coin is partnering with Osprey Funds, a New-York primarily based agency recognized for bringing crypto belongings into conventional markets.
As with all crypto ETP, the transfer goals to decrease boundaries for conventional and institutional traders to entry crypto. An ETP acts as a illustration of the underlying asset’s value — on this case the asset could be BONK — and could be traded on conventional inventory exchanges, eradicating the particular complexities of crypto wallets and exchanges.
In keeping with the announcement, the ETP could be “seed funded by Bonk DAO and strategic partners” and made out there to each retail and institutional traders. Nonetheless, no official launch date has been confirmed but.
If profitable, this may be the primary time a meme coin has entered the ETP house — a crucial shift for a crypto asset class usually seen as particularly speculative, in addition to short-lived and simply plain unserious.
Is a Bonk ETF a completed deal?
Whereas the Bonk group has introduced plans to launch an ETP within the U.S., it’s essential to know that this doesn’t assure that the product will probably be accepted for buying and selling any time quickly — or in any respect.
The announcement is simply step one in what might be a protracted and unsure journey, and regulatory approval from the U.S. Securities and Change Fee stays a key hurdle.
Prior to now, the SEC has been cautious about approving ETPs for even the highest two cryptocurrencies, citing issues about market manipulation, volatility, and lack of investor protections.
For Bonk’s ETP to get accepted, the SEC would possible want to guage a number of issues:
- Market transparency: The SEC would wish to be sure that the markets the place Bonk tokens are traded are steady, clear, and immune to manipulation. Meme cash like Bonk are normally thought-about particularly risky and speculative, which may increase issues.
- Investor safety: The SEC’s predominant job is to guard traders. It could be taking a look at whether or not retail and institutional traders have sufficient info to know the dangers of investing in an ETP with Bonk because the underlying asset. Since meme cash can swing wildly in value, this might be a sticking level.
- Market impression: The SEC would additionally think about whether or not introducing a Bonk ETP may disrupt monetary markets or create unexpected dangers. It could intently consider how an ETP for a meme coin may behave in a different way from one for extra established belongings like Bitcoin or conventional shares.
Whereas Osprey Funds, which is dealing with the Bonk ETP, has expertise with different crypto monetary merchandise, together with Bitcoin ETFs, that also doesn’t assure success.
Even ETP functions for probably the most well-known cryptocurrencies have confronted delays and rejections from the SEC. For instance, spot Bitcoin ETFs took years to get accepted, and plenty of functions had been rejected earlier than the primary one was launched in January 2024.
Briefly, the SEC may approve the ETP, however they might additionally reject or delay it in the event that they really feel the dangers are too excessive or the product doesn’t meet their requirements.
Bonk’s value motion stays flat
The main announcement about launching the first-ever meme coin ETP created some buzz over the weekend, although it has not moved BONK’s spot value dramatically.
As of Sept. 23, BONK is buying and selling at $0.0000175, a 4.3% improve previously 24 hours and a extra notable 8% rise over the previous seven days, which seems to be a part of a wider meme cash rally this previous week.
In comparison with its high meme coin friends, nonetheless, BONK has been buying and selling sideways lately. Shiba Inu (SHIB), as an example, has seen a extra sturdy value improve, rising over 11% within the final seven days to commerce at $0.0000145.
Equally, Pepe (PEPE) has outperformed BONK with positive aspects of greater than 13% on the week. In the meantime, Dogwifhat (WIF) has been the largest gainer amongst high meme cash, with an 18% improve over the previous week, now buying and selling at $1.75.
Meme coin traders, recognized for leaping into extremely speculative belongings, look like extra targeted on tokens like SHIB, PEPE, and WIF, which have proven stronger value motion in latest days.
Moreover, BONK’s comparatively low profile in comparison with the likes of SHIB or PEPE may imply it’s being overshadowed by extra established meme cash.
For now, BONK value motion stays subdued. The meme coin’s value continues to be buying and selling in a comparatively tight vary, down from latest highs in July and August. It stays to be seen if this pattern will proceed, or if extra merchants begin taking discover because the regulatory submitting course of for the ETP develops.
The announcement that Bonk is launching an ETP has sparked assorted reactions throughout social media, cut up between pleasure and skepticism.
For some, this transfer alerts a breakthrough, with one X consumer calling it “insane” (in a great way) and highlighting how Bonk may turn out to be the primary meme coin to enter the ETF house.
Nonetheless, not everybody agrees that the business wants meme coin-based conventional monetary merchandise to maneuver ahead. One other X consumer expressed concern that this may really undermine crypto’s legitimacy. In keeping with their perspective, the push to legitimize meme cash for conventional monetary gamers might be extra about inflating the asset’s worth for present holders than offering real worth to the broader crypto business.
The concern is that strikes like this might shift focus away from what crypto was initially, not less than partially, supposed to perform — providing decentralized alternate options to the normal, mediated monetary system — and result in speculative bubbles as an alternative.
Others added a layer of cynicism, suggesting that meme cash like Bonk are merely looking for “alternative exit liquidity,” particularly as competitors heats up inside the meme coin house.
The approaching months will reveal whether or not this ETP brings precise worth or just provides gas to the speculative fireplace that always surrounds meme cash.