Last week, the Bitcoin ETF (Exchange Traded Fund) decision to reject or approve was delayed once again and the question about same was raised during consensus meet.
The U.S Securities Exchange Commission has the authority to approve or reject a specific request to launch a new ETF on the market. Around nine Bitcoin ETF applications is pending with the SEC. Moreover, the SEC has received a new crypto-basked (Bitcoin and Ethereum) based ETF application.
If ETF approval is done, it would allow the US market to predict and trade on Bitcoin without the need of having to buy and sell Bitcoin. The fund will track the price of the underlying asset, i.e Bitcoin alone or a basket of assets including ‘other’ cryptocurrencies or other bonds, equities or commodities.
Reportedly, the US ETF market total capital is about $5 trillion. Just 1% of the trading moves to Bitcoin, it will successfully increases the Bitcoin market capitalization by $50 billion.
Experts on SEC Options
According to Jake Chervinsky, the Attorney at Kobe and Kim LLP.
“The SEC has delayed the Bitwise bitcoin ETF two days ago but still hasn’t taken a decision on VanEck. This is unusual, because the SEC normally handles both ETFs at once. The deadline for VanEck is next Tuesday and I still think the delay is overwhelmingly likely, but the timing has me curious.”
The comments are likely to get the high hopes for any Bitcoin bull. But, according to the filing dates, the Bitwise deadline was on 16th May, and the deadline for the re-applied Van Eck proposal is 21st May.
The VanEck proposal was withdrawn and re-submitted on 20 February 2019, by the firm itself. The deadline for which is a 45-day period, that ends on 21st May 2019.
Furthermore, in a recent interview, the SEC Commissioner: ‘Hector Peirce’, hinted at a further delay. She said,
“I am still optimistic. Don’t hold your breath. Market manipulation are issues that get a lots of attention at the SEC.”
Therefore, the positive outcome for bulls can be a delay in the approval but not a complete rejection.
Chervinsky also predicted that there is a 75% probability that the proposal will be delayed, denial 24.9% and just 0.1% probability of an approval.
“In the past, the SEC has bundled together all of its decisions on pending bitcoin ETFs & announced them on the same day. But to be honest, the fact that the SEC has delayed Bitwise & stayed silent on VanEck could mean nothing at all.
Moreover, he went on to say, “Bitcoin has been very volatile recently & investigations related to fraud & manipulation have came up : for example, Bitfinex. The SEC got no reason or incentive to come out in favor of bitcoin in this environment.”
We hope the SEC will approve ETF very soon and provides relief to the U.S markets.
As the Bitcoin ETF proposal is been pending for six years since its first application. The SEC has delayed and denied, and all of them until now. Nevertheless, a denial or delay is unlikely to weaken market spirits.