SEC Delays VanEck ETF Proposal Seeking Public Comments

The U.S. Securities and Exchange Commission (SEC) has again postponed making a decision on the VanEck, SolidX, and Cboe joint proposal bitcoin exchange-traded fund (ETF) proposal.

The proposal was filed in January and was delayed in March. In a new document filed Monday, the SEC stated that it was in the process of establishing proceedings on whether to approve or disapprove a proposed rule change that would allow the VanEck SolidX Bitcoin Trust to issue and list its shares on the New York Stock Exchange (NYSE).

Currently, the commission is seeking more comments from public on the proposed ETF as they have received only 25 comments so far. The deadline to submit comments is due 21 days from when the order is published and rebuttal to the comments are due 35 days after the publication.

Following this, the new deadline for the SEC to make its decision has been set up for August 19th , and it could be delayed one more time for a final deadline of October 18th, according to attorney Jake Chervinsky.

Originally, the bitcoin ETF proposal was first filed with the SEC last year, however due to the U.S. government shutdown it was withdrawn in January this year. VanEck/SolidX refiled the proposal later that month, only to receive a delay notice for March 29th. Similarly happened to the proposal filed by Bitwise Asset Management with NYSE Arca.

The commission has postponed making any decision on the two proposals so far this year, with the latest delay on Bitwise’s proposal coming on May 14th. Following this news, the VanEck/SolidX proposal joins the long list of failed attempts to get an ETF approved by the SEC.

Meanwhile, the commission has issued several extensions and rejections on ETF proposals, citing concerns that the proposals did not meet and satisfy SEC standards to prevent fraud, market manipulation, financial crime, liquidity amongst others.

Following today’s announcement, the SEC has reiterated these concerns:

“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.”

The SEC’s repeated delays in sanctioning a bitcoin ETF may reflect its lack of confidence in the maturity of the crypto market. As such, the regulator has turned down at least 10 ETF proposals to date and it has yet to approve one.

In response to the repeated delays, VanEck digital asset strategy director Gabor Gurbacs has stated that “we continue the hard work towards better-regulated, safer and more liquid digital assets markets. Bitcoin is too big to ignore.”

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.

New Cryptocurrency ETF Proposal Filed with the SEC

A new crypto exchange-traded fund (ETF) proposal has been filed with the Securities Exchange Commission (SEC), according to a posting by the SEC on May 9th.

Commodity pool operator United States Commodity Funds LLC (USCF) has created the ETF and will back it alongside Crescent Crypto, a New Jersey-based hedge-fund. USCF comes under the regulatory oversight of the Commodity Futures Trading Commission and the National Futures Association under the Commodity Exchange Act (“CEA”), according to the filing.

The USCF Crescent Crypto Index Fund – “XBET”– will track the performance of a market capitalization weighted portfolio of Bitcoin (BTC) and Ether (ETH), offering investors cryptocurrency exposure through a public vehicle.

According to the filing, the ETF will trade “like other publicly traded securities,” brought and sold daily by investors placing “orders through their brokers and may incur customary brokerage commissions and charges.

XBET will reflect the daily changes in percentage terms of the Crescent Crypto Core II Index (CCINDX), less XBET’s expenses. The new “CCINDX” will comprise of the two cryptocurrencies – BTC and ETH – recognized as a decentralized ledger, which is not controlled by any central authority and price of which is determined by the demand and supply of the asset that is limited in number. The percentage distribution of each cryptocurrency will be re-balanced on a monthly basis.

Although it could be a while until it gets accepted, the co-sponsors expect the ETF’s shares to break even within a year, pitching the initial offering price at $20.00. If approved, the ETF will be issued as shares on the New York Stock Exchange (NYSE) Arca.

At the moment, two separately filed, pure BTC based ETF applications are still pending with the SEC. Decisions on two BTC ETFs – one filed by Bitwise Asset Management with NYSE Arca, and the other one from VanEck and SolidX, in partnership with Cboe BZX Exchange – were recently postponed to be reviewed this month.

However, XBET is not the first ETF proposal which involves Ether. Back in 2017, EtherIndex had filed with the SEC to trade its ETH-based – Ether Trust – product on the NYSE Arca.

Whilst SEC has yet to approve any crypto ETFs, it may be just a matter of time before one passes with the regulator. Earlier in February, SEC Commissioner Robert Jackson stated in an interview that an ETF proposal would eventually “satisfy the standards” the regulator had set.

Abra Becomes the First App to Offer Fractional Investment in Traditional Markets with Bitcoin

Digital wallet Abra has introduced new features enabling global investors to invest in shares and exchange-traded funds (ETFs) using Bitcoin (BTC), according to a press release.

Fractional Investments in the Stock Market

Abra stated the app will utilize the Bitcoin blockchain and smart contracts technologies to support fractional investments in stocks, exchange-traded funds (ETFs). The app already offers investment in 50 fiat currencies and over 30 cryptocurrencies.

“Just as consumers can own a fraction of a bitcoin, they can soon use Abra to own fractions of high-priced stocks and ETFs,”

The U.S.-based firm has announced early access registration to the platform, allowing investors in more than 155 countries to invest with zero trading fees throughout 2019.

For the initial roll-out, Abra said it will offer 50 new investment assets, including stocks from major firms like Facebook, Apple, Amazon, Google, Netflix; commodities like SPDR Gold Trust; ETFs like Vanguard Growth and the S&P 500; and indexes among others.

The app is non-custodial, meaning Abra does not store or have access to user funds. Instead these are stored on the Bitcoin network, making transactions more secure and private than centralized databases used by most crypto exchanges and wallets.

Hedged Against Cryptocurrency Volatility

Abra is offering these investments through using synthetic currency. When you deposit money into the Abra app, your dollars are immediately converted into Bitcoin, only the app will continue to display that your account has dollars sitting in it.

If the price of Bitcoin goes down, your balance will still display the amount of dollars you invested. Abra makes sure of this by hedging your investment in a complex and unique way.

Abra is the first of its kind in the world to offer such service, enabling more cryptocurrencies and fiat currencies. Bill Barhydt, the CEO of Abra notes that:

“We’re going to start with popular US stocks and ETFs and add more global assets in the coming months. Of course, all of the great features for investing in cryptocurrencies and fiat currencies remain fully integrated as well”

The company’s CEO, Bill Barhydt, said:

“We are building bitcoin-backed investing products because, for the first time, we can truly democratize access to investment opportunities at global scale. It shouldn’t matter where you live or how much you earn to be able to make investments and participate in capital markets.”

Founded in 2014, Abra is backed by notable investors including American Express Ventures, Foxconn Technology Group, Arbor Ventures, among others.

CBOE, VanEck and SolidX File for Renewed Bitcoin ETF

The Chicago Board Options Exchange’s (CBOE), along with investment firm VanEck and financial services company SolidX, has resubmitted their joint Bitcoin (BTC) exchange-traded fund (ETF) proposal to the U.S. Securities and Exchange Commission (SEC). It was announced by VanEck digital asset strategy director Gabor Gurbacs on January 31st.

The proposal had been initially withdrawn by CBOE on January 23rd, citing the U.S. government shutdown as the reason for this decision. Prior to that, the VanEck/SolidX filing was facing a final decision date of February 27th, after the SEC extended its examination period a number of times.

At the time, VanEck CEO explained that the companies had been in talks with the SEC regarding the proposal, however these talks ended once the government shutdown started. As such, the proposal had been temporarily withdrawn in order to avoid a possible rejection.

The filing process has experienced several delays, as the SEC pushed back its decision on multiple occasions. The proposal was first filed with the SEC to list a Bitcoin-based ETF on June 6th, 2018. Following that in August, the commission delayed its decision until September 30th. At that time, the SEC stated that the commission had not “reached any conclusions with respect to any of the issues” on the rule change and, as such requested further comments from the public regarding the filing.

In December, the decision was delayed again, and as the proposed rule change was first published in the Federal Register on July 2nd 2018, the maximum period of consideration fell 240 days later, on February 27th 2019. However, now with resubmitting the proposal with the SEC, CBOE has reset the clock and the SEC has 240 days to come to a decision regarding the ETF. Notably, the proposed rule change is yet to be published in the Federal Register, only after which the SEC’s clock will start ticking.

According to the new filing, if the SEC approves the Bitcoin ETF proposal, it would allow the CBOE BZX Exchange to list the shares of Bitcoin ETF Trust. Investors have been eagerly waiting for the arrival of Bitcoin ETF. Many supporters of the ETF believe that the fund will help bring fresh money into the space, creating a more liquid market.

Cboe’s filing comes weeks after NYSE Arca filed its own proposal with Bitwise Asset Management. The most recent application by NYSE Arca might be one of the reasons for a quick filing by CBOE as both competitors want to be the first ones to list a Bitcoin ETF.