The announcement by the U.S. Securities and Exchange Commission (SEC) to delay its decision on the Ark 21Shares Bitcoin spot ETF application has triggered a mixture of excitement and unease in the cryptocurrency community. This delay of almost eight weeks has raised questions about the future of cryptocurrency-based exchange-traded funds in the United States.
The SEC’s decision to delay comes on the heels of a rigorous review process, during which the regulatory body highlighted four primary concerns. Central to these concerns is the apprehension regarding the potential manipulation of the Bitcoin spot ETF.
Additionally, questions have been raised about the adequacy of the Chicago Mercantile Exchange (CME) in ensuring a secure trading environment. Moreover, the extent to which an agreement with Coinbase could safeguard against manipulation has also been a focal point of contention.
The SEC stated:
The regulated market of significant size test does not require that the spot bitcoin market be regulated in order for the Commission to approve this proposal, and precedent makes clear that an underlying market for a spot commodity or currency being a regulated market would actually be an exception to the norm.
Crypto Community Awaits U.S. Bitcoin ETF
The Ark 21Shares Bitcoin ETF application, initially submitted in April, has garnered considerable attention from both crypto enthusiasts and traditional investors. This delay in decision-making, which was expected by some industry insiders, has cast a spotlight on the challenges and opportunities surrounding cryptocurrency-based financial products.
While proponents argue that a Bitcoin spot ETF would democratize access to cryptocurrency investments, skeptics, including regulators, cite concerns about fraud and manipulation as significant hurdles to approval. As the debate rages on, multiple issuers have entered the fray, filing their own spot-BTC ETF applications in the hopes of gaining SEC approval.
Simultaneously, 21Shares, in collaboration with ARK Investment Management led by Cathie Wood, has taken an alternative route by filing for a Bitcoin futures fund. This move demonstrates the eagerness of various entities to enter the cryptocurrency ETF landscape, even through different avenues.
As the SEC’s deliberations continue, all eyes are on the regulatory body, waiting to see if and when the U.S. will see its first-ever approved Bitcoin ETF. With major players like BlackRock Inc. also vying for a spot product, the future of cryptocurrency in traditional financial markets remains uncertain but undeniably intriguing.
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