SEC Delays Decision on Bitwise Bitcoin ETF

The United States Securities and Exchange Commission (SEC) has delayed its decision on cryptocurrency index fund provider Bitwise Asset Management’s bitcoin (BTC) exchange traded fund (ETF).

SEC Looks for Public Comments

In its recent filing, the SEC stated that it has delayed its decision on the approval of the Bitwise ETF, and has also requested for public comments from interested parties.

As such, the Bitwise Bitcoin ETF decision was delayed for another five weeks. According to the published filing, it seems the SEC is still unsure that Bitcoin is resistant to price manipulation, along with several other issues.

Bitwise initially filed for an ETF with the SEC in February. The proposed Bitcoin ETF differs from other previously proposed Bitcoin ETFs in that it draws prices from a list of reputable cryptocurrency exchanges, with the goal of better representing the market. The Bitwise team had also provided the SEC and the public with a detailed research on cryptocurrency exchange volume and possible fake trade volume on more obscure platforms.

According to Bitwise, the ETF will satisfy the rules of the NYSE Arca, providing evidence that the ETF will be accurately priced and resistant to price manipulation. The company wants to achieve this by sourcing the price from the most reliable cryptocurrency exchanges.

Bitwise Targeting Insitutional Investors

The objective of the Bitwise Bitcoin ETF is to broaden access to the crypto-asset to institutions.

Bitwise plans to process all share creation and redemption, and accrue all fees, in Bitcoin rather than fiat. Trading activity of the ETF may have a greater impact on the supply and demand of the coin, unlike other cash-settled alternatives.

In their initial proposal Bitwise noted:

“Having a regulated bank or trust company hold physical assets of a fund has been the standard under U.S. fund regulation for the last 80 years, and we believe that is now possible with Bitcoin,”

Тhe SEC had first delayed its decision on the Bitwise ETF application in March. Following the decision, the SEC was obligated to come to a decision on whether to approve the rule change by May 16, 2019.

Per today’s filing, the public comment period will last three weeks after the most recent amendments to the Bitwise ETF application are published in the Federal Register.