SEC Announces Further Delays to Bitcoin ETF Proposals

Bitcoin

The US Securities and Exchange Commission has announced that it is to delay ruling on three pending bitcoin ETF proposals, the latest extension on its long-awaited judgement of the fund proposals.

The three proposals before the regulator, which aim to set up Exchange Traded Funds exposed to cryptocurrencies like bitcoin and other digital assets and derivatives, require the go-ahead from the SEC before they can be approved for listing.

Considered an important milestone in mainstream adoption of cryptocurrency, ETFs would allow institutional investors to speculate on crypto markets without directly investing in or holding cryptocurrency themselves - an important distinction for regulated investors currently shut out from the crypto asset class.

Final decisions are now expected from late September to the middle of October, which will determine whether any of the three funds are set to become the first of their kind to be approved and listed on a US exchange.

The proposals on the table come from Bitwise Asset Management, VanEck/SolidX and Wilshire Phoenix, and have been filed with Cboe BZX and NYSE Arca exchanges respectively.

They come as the latest in a series of similar proposals laid before the regulator, none of which to date have been accepted for listing on any exchange.

The regulator has previously flagged concerns about the integrity and transparency of crypto markets, citing in large part the lack of cohesive regulation - particularly in the US - around cryptocurrencies and other digital assets.

The current proposals under consideration have sought to find alternative ways to give the regulator confidence, including commingling crypto assets with treasury bonds and other liquid non-crypto investments, in a bid to shore up the integrity of the investment vehicle.

Whether this is sufficient to win the support of the regulator remains to be seen, although the Bitwise proposals in particular have won the backing of several leading industry names, including representatives from Coinbase Custody, Blockchain Association and Blockchain Capital.

The SEC must now finally rule on the proposals at the next mandated date, which will determine whether they proceed to public capital markets.

The delay will be only the latest blow to those agitating for a listed crypto ETF, which many consider to be a significant step in the development cycle of the cryptocurrency sector, en route to mass adoption and investment.