The SEC is reviewing two Bitcoin ETF proposals, according to a statement from the US Securities and Exchange Commission. Both the VanEck/SolidX proposal and the Bitwise proposal are on the table now.
The VanEck/SolidX proposal filed with Cboe BZX Exchange has now appeared in Wednesday’s edition of the Federal Register, officially kicking off the 45-90 days clock to an initial decision. It joins another bitcoin ETF proposal filed by Bitwise Asset Management with NYSE Arca, which was published in the register last week.
The VanEck ETF was on the SEC table for the first time last year, but had to be withdrawn because of the US government shutdown. By the end of January, VanEck/SolidX refiled the proposal, stating to Coindesk that 'a Bitcoin ETF would serve the public if approved'.
A Bitcoin ETF approval is talk of the crypto community for months already. It is believed that an approval would bring a new wave of investments to the space.
Recently, SEC Commissioner and 'Crypto Mom' Hester Peirce said that there likely will be no Bitcoin ETF approval in 2019. Peirce is fighting for the approval of a Bitcoin ETF for the last year. “We have applications.Those are subject to a very specific time frame where we have to act within a certain amount of time, and so that’s what it’s going to depend on. And those are very arcane rules as to whether it happens or not, so I can’t speculate on the timing."
SEC approval
It might not just be the proposals themselves which secure an approval. Matt Hougan, Bitwise global head of research, told CoinDesk that the crypto ecosystem is “evolving very rapidly,” which may aid in getting a product launched.
(Hougan was speaking to his company’s specific proposal, though his remarks reflect on the crypto industry more broadly.)
“A year ago there was maybe one qualified crypto custodian … and now there are half-a-dozen, and that number will go up from here,” he noted as one example.
And this is not the only example. A number of advances and new products have entered the space in a relatively short period of time. Hougan explained:
“A little more than year ago, we didn’t have futures. A year ago we didn’t have nearly as many firms making markets. A few months ago, you didn’t have folks like Fidelity announced in the space. It’s evolving really, really quickly.”
Moreover, he noted, this progress comes despite the broader price movements (the crypto market is currently in its longest bear market since bitcoin was first born a decade ago).
While this progress may be “overshadowed by the price movements,” he said there remains a large amount of development within the space.
His comments echo those of Kobre Kim attorney Jake Chervinsky, who previously told CoinDesk that he believes several more months of development within the ecosystem should see the crypto markets mature to the point where the SEC may feel comfortable approving an ETF.
At the time, Chervinsky explained that the key points the SEC will evaluate are bitcoin’s valuation, liquidity, custody solutions and market manipulation.
Ultimately, however, a bitcoin ETF approval will depend on how companies approach their proposals.
“The SEC has been extraordinarily clear in the Dalia Blass letter and in the Winklevoss rejection letter in what they will require before you can list a product. It’s up to folks in the industry … to meet those standards,” Hougan noted, saying:
“All you can ask for a regulator is to lay out clear bars you have to clear before they will approve something.”
