US SEC delays decision on ARK 21Shares Bitcoin ETF until next year.
US SEC delays decision on ARK 21Shares Bitcoin ETF until next year.
The U.S. Securities and Exchange Commission (SEC) recently made headlines when it announced yet another delay in its decision regarding the proposed ARK 21Shares spot Bitcoin ETF. The decision has been pushed into the next year, with a new deadline set for January 10th.
This delay comes on the heels of a request by a bipartisan group of lawmakers urging SEC Chair Gary Gensler to expedite the approval of a spot Bitcoin exchange-traded fund (ETF). In response, the SEC expressed the need for an extended timeline to thoroughly evaluate the proposed rule change.
This latest postponement is not limited to the ARK 21Shares Bitcoin ETF alone. The SEC has also extended the decision deadline for the proposed Global X Bitcoin Trust to November 21st, indicating a potential series of delays for applications related to spot Bitcoin funds.
The initial proposal by ARK Invest and 21Shares had already faced a previous postponement, with the SEC requesting additional written comments. The original deadline set by the SEC for a decision was August 13th, leaving the fate of the application uncertain.
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Cathie Wood, the CEO of Ark Invest, had predicted this delay, suggesting that the SEC might approve multiple Bitcoin ETFs simultaneously when it eventually gives the green light for these financial products.
Currently, the SEC is reviewing applications for various spot Bitcoin funds from prominent industry players such as BlackRock, Fidelity, VanEck, and Invesco. The ARK 21Shares Bitcoin ETF had been at the forefront of these applications.
The deadlines for decisions on other Bitcoin-related funds have also been extended. BlackRock’s iShares Bitcoin Trust, Fidelity’s Wise Origin Bitcoin Trust, the VanEck Bitcoin Trust, the WisdomTree Bitcoin Trust, and the Invesco Galaxy Bitcoin ETF have all been granted extensions until October 17th.
Meanwhile, the deadline for the Valkyrie Bitcoin Fund has been moved to October 19th, and the Bitwise Bitcoin ETP Trust’s decision deadline was last delayed until October 16th.
It is worth noting that the U.S. SEC has not yet approved a spot Bitcoin ETF, citing concerns related to potential fraud and market manipulation. However, the SEC did allow the first Bitcoin futures ETF to commence trading in 2021.
The delay in the decision-making process for spot Bitcoin ETFs showcases the cautious approach taken by regulators in the United States. While the SEC acknowledges the growing interest and demand for these investment products, it remains focused on protecting investors and maintaining the integrity of the market.
The concerns raised by the SEC revolve around the potential for fraud and manipulation in the cryptocurrency market, which is largely unregulated compared to traditional financial markets. The SEC wants to ensure that proper safeguards and surveillance measures are in place before approving any spot Bitcoin ETFs.
One of the key advantages of blockchain technology, on which cryptocurrencies like Bitcoin are built, is its immutability and transparency. Every transaction recorded on the blockchain is visible to all participants, eliminating the risk of fraud and manipulation associated with traditional financial systems.
However, the SEC’s concerns stem from the surrounding ecosystem, including exchanges and custody solutions. The lack of regulation in these areas raises questions about the security and reliability of the underlying infrastructure for spot Bitcoin ETFs.
To address these concerns, market participants and industry stakeholders are actively working on building robust infrastructure, implementing proper risk management systems, and enhancing investor protection measures. This involves collaborating with regulatory bodies like the SEC to establish a framework that ensures the safe and regulated trading of digital assets.
In conclusion, the series of delays in the decision-making process for spot Bitcoin ETFs by the U.S. SEC highlights the regulatory challenges faced by the blockchain industry. While there is a growing demand for investment products based on cryptocurrencies, regulators are cautious due to concerns over market manipulation and fraud. It is important for the industry to continue working closely with regulatory bodies to address these concerns and establish a framework that safeguards investors and enables the growth of this emerging asset class. The eventual approval of a spot Bitcoin ETF would be a significant milestone, opening doors to institutional investors and further mainstream adoption of cryptocurrencies.