Bitwise has withdrawn its application for the Bitcoin and Ethereum Market Cap Strategy Ethereum Futures Contracts (ETF), initially filed with the Securities and Exchange Commission (SEC) on August 3, 2023.
This development has surprised investors as Bitwise did not provide a specific reason for this decision. Also, the timing of the withdrawal is strange, especially in light of recent developments regarding Grayscale’s apparent success in compelling the SEC to reevaluate its ETF application.
This is not Bitwise’s first withdrawal of an ETF application. Earlier in the year, the company submitted an application for the Ethereum Strategy ETF, designed to invest in both front-time and back-time Ethereum Futures. However, Bitwise withdrew this ETF application just a week after its initial submission.
Meanwhile, the SEC has announced that it is postponing its decision on six applications for spot Bitcoin exchange-traded funds (ETFs). The SEC has justified this delay by emphasizing the importance of having sufficient time to conduct comprehensive assessments of the proposed rule changes and the pertinent issues they raise.
The extension gives the SEC an additional 45 days, effectively extending the decision deadline until October 2023. Consequently, the decision deadlines for several prominent ETF applications are now set for October 17, including those for BlackRock’s iShares Bitcoin Trust, Fidelity’s Wise Origin Bitcoin Trust, the VanEck Bitcoin Trust, the WisdomTree Bitcoin Trust, and the Invesco Galaxy Bitcoin ETF. The decision deadline for the Valkyrie Bitcoin Fund was also rescheduled to October 19.
UPDATE: The first delay order is in. This is for @WisdomTreeFunds spot #Bitcoin ETF filing. As expected delaying for another 45 days. Expecting others to drop shortly CC @EricBalchunas pic.twitter.com/yTYvv9YHt9
— James Seyffart (@JSeyff) August 31, 2023
Notably, the U.S. SEC has consistently rejected spot Bitcoin ETF applications purportedly over concerns about potential fraud and market manipulation. However, Grayscale’s recent legal victory, which was based on the premise that the SEC failed to provide an adequate explanation for its decisions, has brought a glimmer of hope to the prospects of these ETFs.
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