By CCN.com: Chicago Board of Exchanges (CBOE) CEO Ed Tilly believes the cryptocurrency market needs a bitcoin-based Exchange-Traded Note to “truly grow.” His comments come on the back of postponed ETF launches for bitcoin, which could be pushed back indefinitely due to an ongoing U.S. government shutdown.

Regulators “Not Taking Calls”

Hundreds of theories tend to explain the lack of a bolstering bitcoin trading market. However, most base themselves on the absence of both institutional investors and traditional market-like frameworks in the cryptocurrency space.

Tilly strongly agrees with the above. He sees the lack of a traditional market-tracking index and a reliant futures contract – that most Wall Street investors use to hedge their bets – as a limiting factor in the crypto market.

But the lack of quick regulatory decisions made by the government means investors repeatedly face an old story—bitcoin-related financial products getting pushed back due to several reasons, with the most recent one being a government shutdown in the U.S.

Tilly explains his dilemma:

“I have two regulators that are not taking calls right now. That doesn’t mean there is nothing we are interested in. It means nothing is going to happen in this government shutdown.”

Mom and Pop Investors Remain Away from Bitcoin

While the CBOE offers Bitcoin futures on its portal alongside a host of savvy financial instruments, the growth of bitcoin is severely affected by the absence of a trading product geared at “mom and pop” investors – inexperienced traders chasing returns in the financial markets. Typically, such investors bring massive liquidity to the market with small investment portfolios, increasing the monetary value and awareness for many-a-firm. Such retail traders could greatly benefit from trading a bitcoin-tied tracker or note.

For the uninitiated, a bitcoin ETN would fundamentally differ from a futures product. While the latter is a contract for an underlying asset bought at agreed prices but paid for later, the former allows investors to purchase a debt note equalling the price of an underlying asset, such that its value increases if asset price increases and vice-versa. This allows for the trading of assets without actually physically trading said assets.

The presence of ETNs in a market allows investors to hedge their bets and cover losses in case a trade goes awry. Furthermore, purchasing ETNs is a reasonably straightforward process, unlike a significant amount of legwork and legal compliances required to trade futures.

CBOE Bitcoin Products Attract Few Traders

There’s evidence to back claims of ETNs completing the circle of institutional investments in bitcoin. Both CBOE and its rival Chicago Mercantile Exchange (CME) offer Bitcoin futures since January 2017, leading to widespread speculation at the time about institutional money coming to cryptocurrencies.

But trading activity remains wilfully low. The CBOE only has 3,475 contracts in “open interest” as of Monday, compared to 5,038 contracts in January 2018. Pit these figures against the CBOE Volatility Index (VIX) of 370,354 contracts, and bitcoin trading equals a tiny 1.3% of the trading activity compared to CBOE’s most traded product.

Tilly attributes the success to VIX to related financial products structured around the creation, leading both Wall Street investors and retailers to invest.

So what’s holding back crypto-entrepreneurs from providing similar products and increasing adoption? It’s the legion of regulators and decision-making authorities stifling growth in the crypto markets with rejection after rejection of ETF applications, and no formal guidelines on what must be implemented to suit U.S. industry standards.

In August 2018, nine ETFs were declined by the Securities and Exchange Commission, including high-profile offerings from Gemini and SolidX. Regulators cite the lack of control over crypto-markets, both price-wise and judiciary, as the primary concern for authorities.

Tilly believes the first institute or individual to address the SEC’s issue would be awarded the first Bitcoin ETN approval. However, the ongoing shutdown means sophisticated Bitcoin products are not making their mark anytime soon in the traditional markets, let alone offerings based on exposure to other cryptocurrencies such as Ether and XRP.