Nick Chong · 1 hour ago · 2 min read
The U.S. Securities and Exchange Commission (SEC) revealed Thursday that it has, once again, postponed its decision regarding the Cboe Bitcoin exchange-traded fund (ETF).
However, the SEC has initiated proceedings to determine whether to approve or deny the ETF.
In the order, the SEC wrote:
“Institution of such proceedings is appropriate at this time in view of the legal and policy issues raised by the proposed rule change. Institution of proceedings does not indicate that the Commission has reached any conclusions with respect to any of the issues involved.”
As part of the proceedings, the SEC is seeking additional information from the public. As of Sept. 19, the SEC received more than 1,400 letters regarding the proposed ETF. The SEC further stated in the order:
“Pursuant to Section 19(b)(2)(B) of the Act, the Commission is providing notice of the grounds for disapproval under consideration. The Commission is instituting proceedings to allow for additional analysis of the proposed rule change’s consistency with Section 6(b)(5) of the Act, which requires, among other things, that the rules of a national securities exchange be ‘designed to prevent fraudulent and manipulative acts and practices, to promote just and equitable principles of trade,’ and ‘to protect investors and the public interest.’”
This is the second time the SEC has delayed its decision about Cboe’s ETF, which also involves a VanEck and SolidX Bitcoin trust.
Cboe’s Bitcoin ETF Application
If the ETF is approved, Cboe plans to offer accredited investors access to buy and sell SolidX shares and investors will be able to trade a Bitcoin ETF in the form of baskets of 5 SolidX shares (~100 bitcoin) on the Cboe exchange.
Per previous reports:
“The Trust will issue and redeem ‘Baskets,’ each equal to a block of 5 Shares, only to ‘Authorized Participants.’ The size of the Basket is subject to change.”
According to the SEC application, the Bitcoin ETF will be physically backed by secure holdings of bitcoin in the VanEck SolidX Bitcoin Trust, which will trade bitcoin on over-the-counter exchanges, both domestically and internationally.