The U.S. Securities and Exchange Commission (SEC) turned back time yesterday when it delayed decisions on three Bitcoin ETFs, in a situation reminiscent of mid-2018. Bitwise Asset Management, VanEck/SolidX, and Wilshire Phoenix all saw judgments on their applications postponed until later in the year, with the SEC setting a nine-week deadline for the next round of decisions. What wasn’t reminiscent of 2018 however was that the market didn’t move at all in reaction to the news, which shows how little attention the crypto community is giving to a Bitcoin ETF right now.
The SEC has its next deadlines to approve, deny, or delay the Bitwise and VanEck bitcoin ETF proposals on this Wednesday (August 14) and next Monday (August 19) respectively.
My guess on the probabilities for both:
Delay: 90%
Denial: 9.9%
Approval: 0.1%— Jake Chervinsky (@jchervinsky) August 12, 2019
All Eyes on October
October 18 is the date by which we will have the next rulings on the three ETFs, with final decisions due on the Bitwise and VanEck/SolidX applications either on or before that date. A decision is also pencilled in for the Wilshire Phoenix application on September 29, but the SEC can, and likely will, delay a final decision on that one by up to 150 days. The VanEck/SolidX effort, which is being put forward in conjunction with the CBOE, has long been touted as the favorite to be granted a license first, so there may be a little more buzz when the yes or no decision is due in two months time.
Delays are Good News on Balance
Delays are usually viewed in a positive or negative light depending on the context and expectations surrounding them. Last summer there was tremendous excitement over the potential of a Bitcoin ETF, which was why the market reacted negatively when delays or rejections happened.
Since the turn of the year however there has barely been any talk surrounding a Bitcoin ETF, to the point where in May we questioned if anyone was still really that bothered about one. However, given that last month there was speculation that the SEC was considering scrapping Bitcoin ETFs altogether due to market manipulation and volatility, the fact that none of the three applications has been rejected at this stage has to be viewed as a positive factor. We’ll have to wait until the fall however to tell us how the SEC truly feels about the readiness of a Bitcoin ETF.
