According to a report from CoinDesk, the U.S. Securities and Exchange Commission (SEC) has opened a commenting process on a Bitcoin exchange-traded fund (ETF) proposal filed by Wilshire Phoenix and NYSE Arca, which restarts the SEC’s regulatory clock.
It was reported that from the filing’s publication, the SEC has 45 days to make an initial decision on whether or not it should approve or disapprove this product, but may choose to extend the deadline if commissioners deem it necessary.
Wilshire’s product is notably different than its more vanilla counterparts. Instead of offering 100% BTC exposure, Wilshire’s trust will hold positions in both the cryptocurrency and short-term U.S. Treasury bills and American dollars. In a document published to the SEC earlier this year, Wilshire wrote the following on this concept:
“The purpose of the Trust is to provide investors with exposure to BTC in a manner that is more efficient, convenient and less volatile than purchasing stand-alone BTC.”
The document went to say that the Trust isn’t meant to direct emulate a capital allocation in Bitcoin. Instead, Wilshire sees the instrument as a way for prospective investors to gain minimal, but sufficient exposure to the leading cryptocurrency.
Not Everyone Has High Hopes for a Bitcoin ETF
While Wilshire’s cryptocurrency vehicle has characteristics that may make it attractive to crypto-curious investors that are a bit more risk-averse — most of the consumer investor public, according to some surveys — not everyone is convinced that a Bitcoin ETF will make it to the market any time soon.
During a CNBC interview on Tuesday, Todd Rosenbluth, the head of ETF and mutual fund research at CFRA, said that a Bitcoin ETF making it to market within the near future is highly unlikely:
“It’s not the wrapper, it’s not the ETF product that’s the concern, it’s the underlying asset that the SEC is worried about from a fraud standpoint. They don’t want to pull off that band aid too quickly.”
To add, the recent letter denying Bitwise’s product was read by analysts as a “damning indictment of Bitcoin’s market structure. (Jake Chervinsky.)” Arca’s co-founder and a securities lawyer, Philip Liu, in fact, wrote on Twitter that the SEC’s comments confirm it is not convinced that Bitcoin is unsusceptible to price manipulation, presumably due to the international nature of the cryptocurrency market and the lack of proper surveillance.