Bitcoin (BTC) has only just completed its “hardening” — but fiat currency is already getting even “easier” as money after a historic move by the United States central bank.
ETF buys to start imminently
Known as the Secondary Market Corporate Credit Facility (SMCCF) and Primary Market Corporate Credit Facility (PMCCF), the two vehicles will start work “in the near future.”
Announced in March as markets tumbled over coronavirus, the programs mean that the Fed, for the first time in its history, will buy ETFs to artificially maintain a semblance of normality in the market.
“More information on SMCCF and PMCCF eligible corporate bond purchases is forthcoming, including specific start dates, issuer certification requirements and more detailed instructions, more details on pricing, among other operational details,” the press release said.
The Department of the Treasury has made $37.5 billion of the $75 billion equity investment it will make in the special purpose vehicle established by the Federal Reserve for SMCCF and PMCCF.
Asset manager: Fed is “admitting it has failed”
The scale of the intervention saw pointed criticism almost as soon as it was unveiled. Notably, Jeffery Gundlach, CEO of asset manager DoubleLine, publicly questioned its legality.
Last month, Gundlach wrote on Twitter:
The Federal Reserve is presently acting in blatant non-compliance with the Federal Reserve Act of 1913. An institution violating the rules of its own charter is de facto admitting that said institution has failed and is fundamentally broken.
Travis Kling, CEO of hedge fund Ikigai, this week continued the tone.
“Today, #Bitcoin ‘s block reward was programmatically cut in half, as it is every four years. Tomorrow, for the first time in the history of the United States, the Federal Reserve will purchase ETFs,” he tweeted on Monday.
Hard vs soft. Sound vs unsound.
As Cointelegraph reported, warnings have long come from Bitcoin proponents over the financial response to coronavirus.
RT host Max Keiser is among the most vocal critics, while in an appearance on his Keiser Report show, Morgan Creek Digital CEO Mark Yusko likewise contended that the Fed’s actions have no legal basis.
A Bitcoin ETF, long-anticipated but rejected by U.S. regulators, has yet to get the green light to enter the market