The Securities and Exchange Commission (SEC) have so far not appreciated any of the proposed Bitcoin Exchange Traded Funds. The latest under review, which has now been delayed until September 30 2018, is the physically backed Bitcoin ETF which will be based in physical Bitcoins and not future contracts.
This proposal could be different
The Bitcoin ETF is the VanEck Solidx Bitcoin Trust on the CBOE VZK Exchange and has some unique characteristics compared to previously intended BTC ETFs.
One such difference is a comprehensive insurance underwritten by various insurance carriers to protect investors against potential loss or even theft of Bitcoins. It will also be targeted to the more affluent investors and institutions with shares consisting of 25 Bitcoins which is worth more than $160,000. Therefore the liability of the SEC on inexperienced investors is much less.
As per the official press release by SEC
“Pursuant to Section 19(b)(2)(B) of the Act,30 the Commission is providing notice of the grounds for disapproval under consideration. The Commission is instituting proceedings to allow for additional analysis of the proposed rule change’s consistency with Section 6(b)(5) of the Act, which requires, among other things, that the rules of a national securities exchange be “designed to prevent fraudulent and manipulative acts and practices, to promote just and equitable principles of trade,” and “to protect investors and the public interest.”
A staggering level of feedback
The website has received nearly 1400 comments on the proposed rule change, and thus shows that the SEC is taking its time on the decision. The overall feedback system means SEC is trying to understand the issues pertaining to BTC ETF’s before taking a decision.
Present your feedback
Being part of the cryptocurrency community means you too can participate in your views on the matter. There are three methods of leaving a comment- Online Form, Emailing and Mailing them on their official address;
Brent Fields, Secretary Securities and Exchange Commission 100 F Street, NE Washington, DC 20549-0609. Note that the file number for the BTC ETF on the SEC website is SR-CboeBZX-2018-040.
Is the SEC starting to listen?
It looks like the SEC is listening to commissioner Hester Peirce’s encouragement to the SEC on understanding cryptocurrency related products.
Gabor Gurbacs, whose primary role is being the Digital Asset Strategist at VanEck/MVIS tweeted the positivity about the announcement.
I am humbled and impressed by the public support of the VanEck-SolidX initiative to bring to market a well-constructed, liquid, physical, insured Bitcoin ETF. 🙏1400+ comments, 99%+ in favor. The public has spoken! Bitcoin is compatible with the U.S. and global capital markets. pic.twitter.com/Ufuq0swwYT
— Gabor Gurbacs (@gaborgurbacs) September 20, 2018
Another delay, yet again
The decision has been delayed once in June and now could see the final proceedings occurring in February 2019 according to the notable lawyer, Jake Chervinsky.
4.2/ The SEC’s next deadline for VanEck/SolidX is September 30. I expect an announcement by next Friday.
The SEC could delay its decision for another 90 days until December 29. It could then delay for another 60 days until February 27. That would be the absolute final deadline.
— Jake Chervinsky (@jchervinsky) September 20, 2018
However, for now, we anticipate further news closer to September 30 2018.
Last month, August 2018, the SEC declined 9 Bitcoin ETF proposals. The ETF’s rejected included two from Proshares, five from Direxion and two from GraniteShares.