Close on the heels of its rejection by the United States Securities and Exchange Commission (SEC), the Bitwise Asset Management and NYSE Arca have confirmed that they will re-file
their application for their Bitcoin Exchange-Traded Fund (ETF).
Rejecting a proposal to list a Bitcoin ETF on October 9, the Commission stated that the ETF filing from Bitwise Asset Management and NYSE Arca did not meet the requirements.
The US regulators stated that the applicants did not meet the requirements regarding possible market manipulation and illicit activities. The SEC wrote, “Rather, the Commission is
disapproving this proposed rule change because, as discussed below, NYSE Arca has not met its burden under the Exchange Act and the Commission’s Rules of Practice to demonstrate that its proposal is consistent with the requirements of Exchange Act Section 6(b)(5), and, in particular, the requirement that the rules of a national securities exchange be designed to prevent fraudulent and manipulative acts and practices.”
However, Bitcoin markets remained steady after the news broke. At the time of writing, the Bitcoin price is up by 3.20% at $8,520.33.
The decision of the SEC might have come as a big surprise to Bitwise Asset Management since Matt Hougan, Managing Director and Global Head of Research at Bitwise, had recently said, “We’re closer than we’ve ever been before getting a Bitcoin ETF approved.”
Meanwhile, in a press release on October 9, Bitwise Asset Management and NYSE Arca said that even though the Commission has refused their ETF application, they are buoyant about their progress.
The verdict on Bitwise’s ETF proposal had seen multiple delays before this week’s final decision. In line with statutory rules, the SEC had no choice but to reject the application. The press release states: “We deeply appreciate the SEC’s careful review. The detailed feedback they have provided in the Order provides critical context and a clear pathway for ETF applicants to continue moving forward on efforts to list a bitcoin ETF. […] We look forward to continuing to productively engage with the SEC to resolve their remaining concerns, and intend to re-file as soon as appropriate.”
Nevertheless, a year-long dialogue with regulators hasn’t been for nothing, says the company, concluding: “While we were not able to satisfy the SEC’s concerns inside the statutory 240-day review window afforded these filings, and while they have identified the need for additional data and context to interpret our key findings, we are pleased with the progress that the industry has made and believe that, with additional research and continued progress in the broader ecosystem, the remaining concerns and challenges raised in this order will ultimately be satisfied.”