Several asset managers have met the first hurdle following a two-week spree of filing for a Spot Bitcoin ETF. The United States Securities and Exchange Commission (SEC) has stated that some requirements are missing from the Bitcoin ETF filings, the Wall Street Journal reported on Friday.
Spot Bitcoin ETF Filings Are Inadequate
On June 15th, leading asset management firm BlackRock filed for a Spot Bitcoin ETF. The company’s move was soon imitated by other asset managers like WisdomTree, Invesco, Ark Invest, and Fidelity. This has led investors to become optimistic that the regulatory agency will finally support the idea of the financial instrument.
In the latest report, the financial watchdog informed Nasdaq and Cboe, the U.S. stock exchanges that filed applications on behalf of the asset management companies, that the details of the filing documents are insufficient and need more detail.
The SEC expects the companies to outline a spot bitcoin exchange, or a crypto exchange, to facilitate the trades. It also requests adequate details about the “surveillance-sharing agreement” in the document. After completing these requests, the companies can resubmit applications to list the financial product.
A Cboe spokeswoman stated that the Chicago-based stock exchange would update the information and refile. However, Nasdaq is yet to comment on the matter, even though it is widely assumed that BlackRock plans to use Coinbase as its spot bitcoin exchange partner.
SEC vs. Bitcoin ETFs
An exchange-traded fund (ETF) is a financial product that is publicly traded, like a company’s stock. The difference is that, instead of tracking a company’s share price, the ETF tracks the cost of an underlying asset.
By owning a Bitcoin ETF, users gain exposure to the leading cryptocurrency’s price while benefiting from the sophisticated security and user interface akin to the asset management platform they trade with.
However, the SEC has been hesitant to approve a Bitcoin ETF, turning down several asset management firms, including Bitwise, NYDIG, and VanEck, to name a few. In a related development, crypto fund manager Grayscale sued the SEC after it rejected a request to convert the Grayscale Bitcoin Trust into a Bitcoin ETF. The case is still in arbitration.
