The Cboe has re-applied for the rule change that would allow it to offer a Bitcoin ETF on its platform, a week after withdrawing the application. The speed with which the Cboe has re-filed has taken many in the crypto community by surprise, but on the surface it seems to be a positive development for the community, given that the Cboe clearly feels significant progress can be made in discussions with the SEC.
— Gabor Gurbacs (@gaborgurbacs) January 31, 2019
Fall Decision Likely
The filing was withdrawn on January 23 due to the government shutdown halting talks between the Cboe and the SEC, with VanEck CEO Jan van Eck saying at the time:
We were engaged in discussions with the SEC about the Bitcoin-related issues, custody, market manipulation, prices, and that had to stop, and so instead of trying to slip through or something we just had the application pulled and we will re-file and re-engage in discussions when the SEC gets going again. With the government having reopened, Cboe and VanEck representatives clearly feel the opportunity exists to pick talks up again, even though funding is only secured for another two weeks.
Discussions will now turn to the timeline of the new application, with the existing deadline of February 27 now scrapped due to the withdrawal. Securities lawyer Jake Chervinsky offered mid-fall as the likely decision date, stating: “The timeline for the SEC’s decision won’t be set until the proposal is published in the Federal Register, but assuming that happens soon, we’re looking at a final deadline in early October.” He also added, without specifying details, that the new proposal had a better chance of passing than the old one.
No Relief For Investors
For those who are in favor of a Bitcoin ETF such a fast re-submission is good news, but it does mean that a potential catalyst for positive price action is delayed for around ten months. The Bakkt and Fidelity launches still have the potential to act as catalysts, but as they are confirmed for launch the impact will be far less, if anything. An ETF would have offered a temporary boost in prices and some welcome relief for beleaguered investors, but it seems that this will have to wait.