Yet another postponement by the SEC regarding its decision on an application for a bitcoin ETF has arrived.
As with the previous postponement, the SEC is again asking the proponents to submit additional comments specifically on the issue that a bitcoin ETF could be susceptible to manipulation, and how the proponents intend to prevent fraudulent and manipulative acts and practices.
WisdomTree‘s request was originally filed with the SEC on 26 March, and already in April, the agency asked for further details. On 26 May, it had also already asked for more time to decide.
To be honest, this now seems to be the norm, given that the SEC is acting in this way for all applications to issue an ETF on bitcoin on the US market.
In the past, this behaviour has eventually led to approval being refused, or applications being withdrawn, so it is possible that this new wave of applications could also end up in the same way.
However, it has to be said that BTC ETFs are starting to be approved in many other parts of the world, so the longer the SEC hesitates, the more it favours other financial markets, especially Toronto, Canada.
It should be borne in mind that the Toronto stock exchange, for example, is still one of the world’s top ten in terms of market capitalization, albeit far behind the New York Stock Exchange (NYSE) and the Nasdaq.
In fact, the total market cap of securities traded on the TSX (Toronto Stock Exchange) is more than $3 trillion, which is far more than the $2 trillion or so of the Frankfurt stock exchange. By contrast, the Nasdaq capitalizes more than $19 trillion and the NYSE $26 trillion.
Applications to the SEC for approval of bitcoin ETFs
To date, 12 applications for the issuance of a bitcoin ETF have been filed with the SEC.
There are already 12 U.S. filings for a #Bitcoin ETF.
S&P 500 is tracked by 13 ETFs.
— Bitcoin Archive 🗄🚀🌔 (@BTC_Archive) July 14, 2021
The curious thing is that there are 13 ETFs that replicate the S&P 500 Index, which is only one more than the number of proposed bitcoin ETFs.
So it is more than clear that there is market interest in such a derivative product, but the SEC remains concerned that it could be used to manipulate markets in order to siphon off capital, particularly from casual retail investors.
So, unless something changes, it is possible to expect that the SEC’s attitude on this matter will not change. At least for now.