SEC Delays Approval of VanEck Bitcoin ETF, Again

VanEck is requesting approval to be listed and have tradable shares on Cboe Global Markets Inc. If approved, it will be the first open bitcoin ETF in the US.

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key takeaways

  • The government regulator delayed its decision, said it needed more time to evaluate the proposal
  • “Until the SEC gets comfortable that proper investor protections are in place, there simply won’t be a U.S.-listed bitcoin ETF,” Nathan Geraci, the president of The ETF Store, Inc., told Blockworks.

The United States Securities and Exchange Commission has delayed its decision on approving the VanEck exchange-traded fund, pushing the deadline to July, according to a filing.

This is the second time the SEC has delayed making a decision on the VanEck Bitcoin Trust since April after the regulator said it needed more time to evaluate the proposal. 

The denial has been pretty predictable, said Dave Nadig, director of research and CIO of ETF Flows. 

“The important thing to remember is that there aren’t really any deadlines, as the SEC can always delay,” Nadig said.

VanEck is requesting approval to be listed and have tradable shares on Cboe Global Markets Inc., If approved, it will be the first open bitcoin ETF in the US. 

The SEC is now requesting “that interested persons provide written submissions of their views, data, and arguments” in addition to “any other concerns they may have with the proposal.”

One of the big questions the government entity asked was whether or not the proposed ETF was designed to prevent fraudulent and manipulative acts and practices. 

“The SEC continues to express rather significant concerns regarding the potential for fraud and manipulation in the underlying bitcoin spot market. Until the SEC gets comfortable that proper investor protections are in place, there simply won’t be a U.S.-listed bitcoin ETF,” Nathan Geraci, the president of The ETF Store, Inc. said in an interview with Blockworks.

Since the first bitcoin ETF application was filed eight years ago (and rejected), there have been at least 12 applications sent in to the SEC, with more recent notable companies like Valkyrie and Wisdom Tree requesting for approval. As it stands, eight ETF applications are currently awaiting a SEC decision, in addition to other crypto-based filings. 

“It’s become “groundhog day” for every prospective bitcoin ETF issuer over the past eight years: file for an ETF, hope for the best, and get denied by the SEC. ETF investors are clamoring for a bitcoin ETF. The SEC just isn’t there yet,” Geraci said. 

Earlier this year, The Ontario Securities Commission (OSC) approved Canada’s second bitcoin ETF. While some bitcoin market players don’t think the SEC will approve the proposal, other bitcoin enthusiasts believe Canada’s progression can encourage the US and potentially point to a promising future for ETF approvals.

“ETFs have become the dominant vehicle for investors and traders of all types in the US. The fact that the only way you can get securitized crypto exposure is through under-regulated OTC trusts is frankly ridiculous,” Nadig said.

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