The U.S. SEC revealed on Thursday through its website that it has started a formal review process for the proposed Bitcoin ETF by VanEck and SolidX a physically backed Bitcoin ETF.
Review Commences On Formerly Rejected ETF Proposal
Approval of the physically-backed Bitcoin ETF proposal of VanEck and SolidX was previously postponed, with a deadline of September 30 by the U.S. SEC. This was postponed in August.
One of the expectations of the cryptocurrency community for the value of Bitcoin and other cryptocurrencies to rise is the decision of the U.S. SEC on the this postponed ETF.
The U.S. SEC, however, revealed on Thursday via its website that it has started the review of the physically backed Bitcoin ETF that was previously postponed by the commission.
The release on its website dated 20th September noted that the regulatory agency would consider the approval of the ETF based on the federal securities guidelines for a listing on the CBOE BZX Exchange.
SEC noted that institution of such proceedings is appropriate at this time, especially given the legal and the policy issues raised by the proposed rule change. Also, the SEC noted that starting the proceedings does not mean that the commission has reached a definite conclusion concerning any of the issues involved.
While the cryptocurrency ecosystem awaits the U.S. SEC verdict on the Bitcoin ETF, some analyst believes that SEC will still postpone the ETF approval to March 2019. The same opinion is also shared by Canadian investment firm Canaccord, among others.
The VanEck-SolidX Bitcoin ETF Proposal
The Bitcoin ETF proposal of VanEck-SolidX is said to be different from other Bitcoin ETF proposals that have been made. The Bitcoin ETF involves holding of physical BTC, unlike future cryptocurrency contracts. Notably, this features maintaining comprehensive insurance underwritten by the various insurance carriers to protect investors against loss or theft of these assets.
The share of the ETF will be available for retail buyers at the rate of 25 BTC, an estimate of over $160,000 at the present exchange rate. This shows that it will only be available to wealthy investors and institutions. Meanwhile, the SEC has been cautious in making investment product that is riskily available to unsophisticated buyers.
Despite the hope placed on the Bitcoin ETF by the cryptocurrency investors and enthusiasts alike, its approval any time soon is of low probability. After the bunch of previous rejection and the only SEC commissioner with a favorable disposition to cryptocurrency being Hester Peirce, Bitcoin ETF approval might not be seen this year.