SEC Opens Public Consultation for Latest Bitcoin ETF

Bitcoin SEC Securities and Exchange Commission ETF exchange traded fund

The Securities and Exchange Commission has begun accepting public comments on proposals for a new exchange traded fund backed by a portfolio of bitcoin and Treasury bills.

The U.S. regulator has yet to approve an ETF, which many regard as an important milestone for attracting more significant institutional investment into the space.

The consultation period kicks off a process that will ultimately see the regulator decide within 45 days whether the proposals get the green light, which would ultimately see the fund traded on the NYSE Arca exchange.

The fund, which is being promoted by Wilshire Phoenix Funds, requires a change to listing rules, with the consultation period on the proposals scheduled to run for 21 days. The clock formally starts once the proposals are filed with the Federal Register, although the SEC has opted to begin accepting public comments early.

The regulator then has the standard 45-day period to give its verdict, though this can be extended by the regulator as required, with extensions of this kind already used on a number of prior occasions.

The proposals will see shares sold in a fund called the United States Bitcoin and Treasury Investment Trust, which will invest exclusively in bitcoin and short-term U.S. Treasury bills, and will be overseen by a named fund manager.

The fund is set to work with Coinbase for custody of its bitcoin holdings, and has secured a further $200 million in crypto theft cover.

The fund joins several others under active consideration by the regulator, which analysts hope will eventually lead to the creation of the first ETF listing of its kind.

Aimed at investors and institutions looking to speculate on cryptocurrency without holding crypto directly, the approval of an ETF will be viewed as a significant development for the crypto sector, taking crypto investments to a more mainstream financial audience.

However, the SEC has thus far proved reluctant to approve proposals, with concerns over transparency in cryptocurrency markets, not to mention significant volatility, undermining the proposals submitted to date.

By balancing BTC investments with ultra-secure Treasury bills, Wilshire Phoenix Funds is hoping the SEC will look favorably upon its plans.