Bitcoin ETFs never seem to be out of the news for long, and this week is no different, with the SEC closing the door on public comments regarding the 9 ETFs it had reopened a month ago. The ETFs, submitted by Direxion, GraniteShares, and ProShares, were initially denied in August due to the “insignificant size” of the ETFs and the lack of oversight in regard to potential price manipulation. But, were opened for review just a day later, with the SEC citing the desire to review work that was delegated to individuals.
Public comments on the previously rejected ETF applications were opened on October 4, and their closure on November 5 brings to an end another chapter of the review process, although some took the announcement to be a precursor to a decision. In truth, no deadline has been set to decide on this bundle of re-opened ETFs, given that the comments must be collated and reviewed alongside all other evidence first.
The only ETF application with a deadline is the much-hyped VanEck SolidX offering, which will be reviewed by the SEC until February 2019 at the latest, but could be approved or rejected any time before then. The SEC called for public comments on this ETF in September.
What is an ETF?
An ETF, or exchange traded fund, is an investment fund that tracks the performance of an underlying asset or group of assets without having to actually store the assets themselves, allowing those without a technical knowledge of Bitcoin to be exposed to the market moves without risking their Bitcoin being lost or stolen. Naturally, this presents a very tempting opportunity for institutional investors to expose themselves to the Bitcoin’s well-known volatility, which could bring billions of dollars into the ecosystem.
Some have lamented the potential of an ETF, claiming that Wall Street will be able to invalidate the self-imposed scarcity inherent in Bitcoin and control the price. Whatever the end result, there will be plenty more twists and turns in the road until decision time comes.