Bitcoin ETFs Not Likely In the Future

etf bitcoin

Since the disapproval decision of the proposed rule change of Bats BZX Exchange for Coin ETF, the U.S. SEC also known as Securities and Exchange Commission still has two remaining Bitcoin ETFs to examine; Solidx Bitcoin Trust and Bitcoin Investment Trust of Barry Silbert.

The former needs to be decided by the commission on March 30 while the latter will still be for many months away.

Possible Rejections for two Upcoming Bitcoin ETFs

Last Friday, the SEC’s disapproval decision of the rule change proposed for Coin ETF was based primarily on the bitcoin market’s nature. The Bats BZX Exchange should obtain agreements for surveillance-sharing with markets significant for trading bitcoin as well as its derivatives adding that those markets should be regulated to have a consistent rule change with the known Exchange Act as demanded by the Commission.

But the two criteria have not been met since bitcoin’s significant market is believed to be not regulated by the Commission.

There is only a slim chance or even none, that markets significant for bitcoin will ever be regulated for the upcoming future. The greater Bitcoin community since then understood this and is expecting a rejection from the Commission with regards to the rule change proposed for the Bitcoin ETF Solidx Bitcoin Trust according to the observation in online forums and chat rooms.

Spencer Bogart, confirms the expectation of the community. He was a former Needham analyst but currently the Blockchain Capital LLC’s Head of Research. He explained how the reasons for Coin ETF disapproval correlate to the fundamental bitcoin market’s dynamics, opposing to something definite with regards to ETF filing, he conveyed to Bitcoin that:

Solidx Bitcoin Trust’s chance of a positive approval by the SEC is ‘extremely low’ adding that the grounds will just be the same, according to Bogart who is known for his estimated sub-25% chance of Coin ETF’s approval.

No One Can Do Much

Bogart added furtherly that the sponsors, NYSE Arca as well as Solidx Management LLC can’t contribute enough to increase Solidx Bitcoin Trust’s chances of being approved. He said that he didn’t think NYSE Arca carries a greater chance of having its rule change approved compared to Bats BZX Exchange, saying further that:

etf bitcoin

Future Prospect of SEC’s Approval

On Friday, the SEC noted that eventually markets that are bitcoin-related regulated of significant size can develop adequate for the approval of a Bitcoin ETF. But Bogart thinks differently, saying that:

etf bitcoin

NYSE Arca submitted on February 24, the first amendment to the rule change proposal in relation to the listing as well as trading of the Solidx Bitcoin Trust shares covered by the Rules 8.201 of NYSE Arca Equities.

The judgement is due on 16th of March. When there is lesser chance of approval, proposed rule changes are sometimes withdrawn by exchanges. During press time, nothing has been done by NYSE Arca and there is no response yet from the Solidx team with regards to Bitcoin’s request for comment.

Written by Melvin Draupnir on April 4, 2017.