Introduction
The Securities and Exchange Commission (SEC) has announced a delay in its decision on the ARK 21Shares Bitcoin (BTC) ETF application. Rather, it has opened a 21-day comment period to gather feedback from the public on this investment product.
Amendment No. 3
In July, the Cboe exchange made an amendment to the application, naming Coinbase as the surveillance sharing agreement partner for the ETF. This amendment, referred to as “Amendment No. 3”, has raised legal and policy issues that the SEC needs to address.
Comment Period
The SEC has requested interested individuals to provide written submissions regarding their views, data, and arguments on the proposed rule change, as well as any concerns they may have. The comment period will last for 21 days, and a 35-day period for rebuttals is also available. This process is expected to extend the timeline for the decision.
ARK CEO’s View
Cathie Wood, CEO of ARK, has mentioned that she expects the SEC to approve multiple bitcoin ETFs at once. She believes that the success of each ETF will ultimately depend on marketing and communication strategies.
Timeline and Final Decision
ARK filed the ETF application in May, giving the SEC a maximum of 240 days to reach a final decision. However, the delay in the decision was expected, as little has changed in terms of preventing Bitcoin price manipulation. Previous spot BTC ETF applications were denied due to concerns about fake and manipulated trading activity on foreign exchanges. The SEC wants mechanisms in place to detect fraud before approving a Bitcoin ETF.
Industry Perspectives
ETF analysts and industry experts have varying opinions on the delay and its implications. Some believe that the SEC is prioritizing review for applications from larger financial institutions like BlackRock and Fidelity. Others are eagerly awaiting the SEC’s decision on the BlackRock ETF application as it may set a precedent for future approvals.
The SEC currently has several spot BTC ETF applications from various institutions on its review docket, including BlackRock, Fidelity, VanEck, WisdomTree, Bitwise, and Invesco.
