Decision On Bitcoin ETF Coming March 11

After many delays, the SEC says a decision is coming this spring.

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Reviewed by: Cinthia Murphy
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Edited by: Cinthia Murphy

The Securities and Exchange Commission said this week it will decide whether to approve the Winklevoss Bitcoin Trust (COIN) on March 11.

The decision comes roughly eight months after regulators first asked for public comment on the fund, and some three years since Tyler and Cameron Winklevoss first put the ETF in registration. It would also most likely be made by Walter "Jay" Clayton, President-elect Donald Trump’s pick for SEC chair. Clayton is a partner in the New York office of law firm Sullivan & Cromwell.

The approval process has been plagued with delays some say center on the fact that bitcoin is still too new, too unregulated and too risky—there is often news of fraud and losses associated with bitcoin platforms—for an easy decision. Bitcoin is both a cryptocurrency and a payment system where transactions happen person-to-person, without intermediaries.

In the past two months or so, the SEC said it has received some 30 letters of comment, according to the note published Wednesday.

Split Support

Supporters have generally argued that the ETF wrapper would make access to bitcoin safer, easier and more transparent. Others, however, have raised concerns about risks of such an investment. Some want more audits, more “proof of assets,” more checks and balances in place to vet those holding the bitcoins, and to regularly report on the movement of bitcoins every time one is bought or sold.

In a recent interview, Spencer Bogart, a bitcoin researcher at Needham & Company and a former analyst at ETF.com, says that while individual investors can already access bitcoins directly, a bitcoin ETF could appeal to institutional investors who often are only able to invest in registered investment securities.

Today ETF investors can only access bitcoins through a small allocation in the ARK Web x.0 ETF (ARKW), which obtains its exposure through publicly traded shares of Grayscale’s Bitcoin Investment Trust (OTCQX: GBTC).

If launched, COIN would list on Bats, which owns ETF.com.

Contact Cinthia Murphy at [email protected]

 

Cinthia Murphy is head of digital experience, advocating for the user in all that etf.com does. She previously served as managing editor and writer for etf.com, specializing in ETF content and multimedia. Cinthia’s experience includes time at Dow Jones and former BridgeNews, covering commodity futures markets in Chicago and Brazil equities in Sao Paulo. She has a bachelor’s degree in journalism from the University of Missouri-Columbia.