Bitcoin Exchange Traded Fund ETF application to be listed on Cboe BZX Exchange was withdrawn on Wednesday. This was made known through a press release of SEC on January 22. Though the reason for the withdrawal was not stated, Jan van Eck, the chief executive officer of VanEck, stated the US government shutdown had hampered the Bitcoin ETF talk progress.
U.S. Government Shutdown and Impact On Bitcoin ETF
The recent withdrawal of the closely watched Bitcoin ETF application of CBOE gave a huge set back to the actualisation of Bitcoin ETF in the crypto community. The VanEck director of digital asset strategy Gabor Gurbacs noted that the proposal is temporarily withdrawn.
While speaking on CNBC on Wednesday van Eck, the chief executive officer of VanEck stated that the impact of the US government shutdown on the securities and exchange commission hampered the ETF talk process between the regulator and the ETF applicants. He stated that the discussion on the ETF application made in June 2018 had to stop because of this.
VanEck explained that the firm was engaged in discussion with the SEC on the Bitcoin-related issues, custody, market, manipulation, prices among others that need to be stopped. However, due to the shutdown, there was a need to withdraw and refile and reengage the SEC when the agency gets going again.
Bob Pisani, VanEck’s host on CNBC, quizzed him on the possibility of the application-facing rejection regardless due to the Bitcoin custody and price issues. VanEck responded by stating that he thinks that the firm has a solid answer to the issues, but there is a need to demonstrate it clearly and convincingly to the regulators. He noted the firm has been making an effort on it but has been impossible due to the shutdown.
On the issue, Jake Chervinsky, a lawyer with Kobre & Kim commented that the ETF sponsors made the right decision to withdraw their proposal. He sees it as the best choice due to the shortage of SEC staff to review and approve the proposal and a stance to live to fight another day.
Effect Of The Lingering Government Shutdown
The government shutdown which is the longest in the history of the United States since December 22 over the disagreement on the funding of the US Mexico border wall has had an adverse impact on the economy as well as some other crypto projects.
Crypto projects at the mercy of the shutdown include that of bitcoin futures platform Bakkt and crypto trading platform ErisX, waiting on Commodity Futures Exchange Commission a government agency that is also affected for funding.