There appears to be no end to the controversy regarding approval for the Bitcoin ETF
(Exchange-Traded Fund) as the U.S. Securities and Exchange Commission (SEC) has announced its decision to review Bitwise’s application for a Bitcoin ETF, which the Commission had rejected as recently as October 9.
In a lengthy 112-page order dated October 9, the US regulator had rejected the application for a
Bitcoin ETF filed by Bitwise Asset Management in partnership with NYSE Arca on the plea that
the applicants did not meet the necessary requirements regarding possible market manipulation and illicit activities.
Now in a turnaround decision, the US regulator in a Federal Register document (dated November 12 but published on November 18) announced that its five commissioners will re-review the Bitcoin ETF application by Bitwise Asset Management. While announcing its willingness to review the application, SEC has also invited stakeholders to file statements in support of the ETF application by December 18.
Will the SEC finally give in to the repeated demands for a Bitcoin ETF by Bitcoin investors?
That is the question on every investor’s mind even as the US regulators huddle together to review the Bitwise application.
However, if recent history is any indication, it seems difficult for the applicants to get approval from the SEC as the regulator has been on a rejecting spree. Before rejecting the Bitwise application on October 9, more than a dozen Bitcoin ETF proposals were rejected by the SEC in May this year, citing the high volatility of the Bitcoin price, among other regulatory issues, as reasons for rejection. Sensing a similar fate, several investment firms even withdrew their proposals.
Will Bitwise Asset Management and NYSE Arca be lucky this time to get approval from the
SEC to launch a Bitcoin ETF? Given the public stance taken by the SEC Chairman on Bitcoin ETF, the answer may not be affirmative.