Those hoping for a Bitcoin exchange traded fund (ETF) might have to wait a bit longer, following a large number of negative comments over proposals currently before regulators in the United States.
The VanEck/SolidX ETF had been considered by some investors to be the most likely candidate yet to receive the approval of the U.S. Securities and Exchange Commission (SEC), which would pave the way for a successful public listing.
However, as part of a consultation process on the proposals, the SEC has confirmed the majority of public feedback received about the plans was negative. Comments on the plans were invited up to March 12, as part of an official process that culminates with a ruling from the regulator.
The SEC has thus far been unwilling to grant approval to any crypto ETF, on the grounds of market manipulation and a lack of regulation.
While some had been optimistic about the VanEck/SolidX proposals satisfying regulators, news of the deluge of bad feedback is unlikely to help the cause.
Of the seven total comments received on the proposals, six urge the regulator not to approve the plans, with one supportive voice from Sami Santos, who said there was no point being precious about manipulation in a wider ecosystem of unregulated exchanges.
Santos commented, “Regarding the argument of the SEC that has not yet approved an ETF because of manipulation and mainly appreciates the protection of investors is contradictory, because without an investment fund the investor is susceptible to buy bitcoins in deregulated exchanges and lose their investments, (bitcoins), VanEck already offers insurance to cover possible losses and as such, the investor will show interest in investing in an ETF fund.”
Another respondent, D. Barnwell, urged the regulator to ‘wait and watch,’ suggesting blockchain technology was more significant than a crypto ETF. According to Barnwell, “I would ask the SEC…to take a ‘watch and wait approach’…[t]he true game changer is the underlying technology blockchain, not the cryptocurrency. And to make inroads into this industry-changing technology, one does not need to have a financial product based on the cryptocurrency.”
Other comments point to the lack of intrinsic value in Bitcoin Core (BTC), as well as flagging well-documented problems with the technology, long since superseded by more effective alternatives like Bitcoin SV.
While SEC Chairman Jay Clayton has previously said there “may be a case where a Bitcoin ETF could satisfy our rules,” it seems as far away as ever with the current proposals on the table.
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