7 hours ago
The US Securities and Exchange Commission (SEC) has issued a enactment order connected Bitwise’s bid to person its over-the-counter (OTC) crypto scale money into a spot exchange-traded money (ETF).
The determination came conscionable hours aft the SEC’s Division of Trading and Markets granted accelerated support for the exertion connected July 22.
The stay, issued by the SEC’s Office of the Secretary, temporarily suspends the fund’s modulation to ETF presumption pending further review. If allowed to proceed, the Bitwise 10 Crypto Index Fund (BITW) would commercialized connected NYSE Arca nether the amended Rule 8.500-E, which governs the listing of Trust Units.
Bitwise archetypal filed its ETF conversion petition successful November 2024. The fund, launched successful 2017, holds astir $1.68 cardinal successful assets nether management.
As of July 22, Bitcoin accounts for 73.8% of the portfolio, followed by Ethereum astatine 13.8% and XRP astatine 6.5%. Other constituents see Solana, Cardano, Sui, Chainlink, Avalanche, Litecoin, and Polkadot successful smaller proportions.
SEC’s signifier of post-approval delays
The SEC’s latest determination echoes a akin signifier observed earlier this month.
On that occasion, the bureau approved Grayscale’s request to person its Digital Large Cap Fund (GDLC) into an ETF, lone to issue a stay the pursuing day. The GDLC besides holds important integer assets similar Bitcoin and Ethereum.
Grayscale responded by challenging the stay, arguing that the support was automatic owed to the expiration of the SEC’s statutory reappraisal period. The steadfast claimed the Commission lacked the authorization to reverse a determination efficaciously passed into law.
Bloomberg ETF expert James Seyffart suggested the SEC mightiness beryllium intentionally delaying these approvals to finalize a broader regulatory framework.
According to him:
“[This] mightiness beryllium the SEC’s mode of stalling these things from becoming ETFs earlier they travel up with a integer assets ETF framework. AKA immoderate benignant of generic listing modular for what integer assets are allowed successful an ETF wrapper and what criteria they’ll use.”
According to reports, the model would let issuers to nary longer request to record idiosyncratic rule-change requests if their tokens conscionable definite criteria. Instead, sponsors would registry with Form S-1, acquisition a 75-day review, and database the merchandise upon clearance.
Meanwhile, concern lawyer Scott Johnsson offered a antithetic mentation of the repeated delays.
According to him, the fiscal regulator could beryllium deliberately utilizing the delegated authorization to hold last approvals, perchance to debar penalizing applicants similar Grayscale oregon to circumvent the 240-day statutory reappraisal period.
Nevertheless, the lawyer noted that these issues should not hap nether SEC Paul Atkins’s pro-crypto regime.
Considering this, Johnsson believes the uncertainty could beryllium resolved earlier the October deadline, erstwhile respective high-profile ETF applications are expected to look last decisions.
The station Why the SEC is stalling caller crypto ETFs adjacent aft greenlighting them? appeared archetypal connected CryptoSlate.
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