The US SEC postpones making a decision on a bitcoin US treasury bond exchange-traded fund which was proposed by Wilshire Phoenix as we are reading further in the upcoming Bitcoin news below.
According to the latest documents published on Friday, the SEC postpones bringing a decision and will continue to evaluate the proposal which was initially filed earlier this summer and the next decision date will approve or reject the ETF proposal. The securities regulator was really skeptic about approving any Bitcoin ETF and even rejected more than a dozen in the past two years. The agency also pointed many concerns about market manipulation and surveillance sharing as two different subjects and will likely need to prepare the field better before approving an ETF.
Wilshire Phoenix believes that they found a way to address the problems and, in an interview,, the Wilshire founder and managing partner William Herrmann stated that the company’s proposal which was filed with NYSE Arca, is now a multi-asset trust that will protect it against the high volatility of the bitcoin’s price. If the volatility of the price increases, the trust will automatically rebalance and will decrease the bitcoin exposure and increase the Treasury bills exposure. If the volatility falls, the Treasury bill exposure will as well.
The company filed a comment letter trying to further address these concerns. Herrmann explained that the letter that was ‘’addresses how the exchange-traded product is fundamentally and structurally different from prior bitcoin-related ETP application.’’ He continued:
“The comment goes on to show how the two markets that are relevant to the Trust – referred to by the Commission as the ‘regulated markets of significant size’ – are the CME bitcoin futures market and the spot market composed of the five constituent exchanges from which pricing for the CME CF BRR is determined.’’
The major exchanges such as Coinbase, itBit, Bitstamp, Kraken and Gemini and represent the majority of the Bitcoin-U.S dollar market. The exchanges also have surveillance-sharing agreements and CF Benchmarks and the CME and the reference rate’s administrator. It still remains unclear whether the SEC will ever approve any ETF in the near term and the most rejection once the agency denied Bitwise asset management’s latest bid only spiked again the agency’s concerns. The SEC Commissioners are now reviewing the rejection but it is unclear whether they will reach a decision.
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