Bitcoin Spot ETF: Wait Gets Longer As SEC Drags Decision On Key Proposal

The Securities and Exchange Commission gave itself some more time in deciding on the ARK 21Shares Bitcoin ETF. In a notice issued on Tuesday, the commission said it is extending a longer period for any action in the proposed ETF. In May this year, Ark Investment and 21Shares have again filed with the U.S. SEC for listing a spot Bitcoin ETF under Cboe BZX Exchange.

SEC Extends Decision By Another 45 Days

According to Section 19(b)(2) of the Securities Exchange Act of 1934, the SEC may approve or disapprove such a rule change within 45 days. In the instance of need for longer period, the law provides for deciding on the proposal within an extension of another 90 days.

“The Commission finds that it is appropriate to designate a longer period within which to take action on the proposed rule change so that it has sufficient time to consider the proposed rule change and the issues raised.”

Accordingly, the SEC designated August 30 as the date by which it would either approve or disapprove the proposed
rule change.

SEC Adamant On Approving Bitcoin ETFs

So far, the commission is yet to approve a single crypto related ETF application. Last month, the SEC rejected Grayscale’s application for converting its Grayscale Bitcoin Trust (GBTC) vehicle to a spot Bitcoin. Following this, the Grayscale management filed a lawsuit against the SEC. The case is currently on review at the appellate court. If the case does not materialize in its favor, Grayscale plans to move the Supreme Court. The company had filed its application for converting its GBTC product to a spot Bitcoin ETF in November 2021.

Meanwhilem there is a growing sense of criticism to the SEC’s approach towards Bitcoin ETF proposals. Alistair Milne, an entrepreneur, said the SEC’s denial is only moving economic activity to outside the U.S..

“All the SEC is achieving by denying a Bitcoin ETF in the US is moving economic activity outside their country.”