Two of the three ETF proposals have been filed earlier this year. First is by Bitwise Asset Management under NYSE Arca and second is VanEck/SolidX under Cboe BZX Exchange.
To those two, joined Wilshire Phoenix Funds in June, with proposing a fund that shields Bitcoin with Treasury bills.
The new deadline for the SEC to make a decision on Wilshire Phoenix is now Sept. 29, while Bitwise and VanEck/SolidX will wait for a month more – Oct. 13 and Oct. 18.
Since the beginning of the year, SEC has been postponing its decisions on these Bitcoin ETFs, constantly saying:
“The Commission finds it appropriate to designate a longer period within which to issue an order approving or disapproving the proposed rule change so that it has sufficient time to consider this proposed rule change.”
Bitwise tried to diminish SEC’s worries by publishing multiple reports claiming that the real Bitcoin market is much smaller, more regulated and much better governed than it’s widely meant and that it cooperates tightly with CME’s futures market.
The company also claims that the Bitcoin market is “extremely efficient,” saying that 95 percent of Bitcoin trading volume is fake.
Bitwise’s ETF proposal has surprisingly been pretty good accepted by numerous individuals in the industry, including Blockchain Capital’s Spencer Bogart; Castle Island Ventures’ Matthew Walsh; Coinbase Custody’s Sam McIngvale; the Blockchain Association’s Kristin Smith; including more than 30 others.
The VanEck proposal was filed in January with Cboe BZX, but was then pulled because of a long-lasting government shutdown. The companies tried again later the same month, just after Bitwise Asset Management filed its own ETF proposal with NYSE Arca, but failed again.
However, VanEck application being still in the running might actually be a good sign. Let’s not forget that applications from ProShares, Direxion, GraniteShares, and Gemini have all been diverted by the SEC because of threats about manipulation in Bitcoin markets.
In their “Order Instituting Proceedings to Determine Whether to Approve or Disapprove a Proposed Rule Change to List and Trade Shares of the VanEck SolidX Bitcoin Trust,” the SEC notes that they’ve got 25 submissions from the public regarding Van Eck’s proposal.
However, now they are again asking for more feedback from the public and have a long list of very specific questions regarding the nature and stability of fundamental Bitcoin markets.
The Wilshire Phoenix United States Bitcoin and Treasury Investment Trust filed an S-1 back in January, and submitted an amended proposal on May 21, proposing a new Exchange-Traded Product (ETP) model grouping Treasury bills (T-bills) with Bitcoin to bring new investors to crypto.
They thought that by proposing T-bills, they have solved the problem. They also thought that the trust is going to use Coinbase Custody (insured up to $200 million), short-term treasuries and cash equivalents that are held by UMB Financial Corporation. The SEC then has less than 45 days to rule on the proposal, and if approved, retail shares would be traded on the New York Stock Exchange Arca, introducing crypto to a wider market. However, seems that their plan didn’t work out quite good as they thought.
With no real backing moments from the SEC on the crypto front, there are rational worries that expanding stability is just not enough to get consent.