NYSE Arca Exchange Submits Updated Application for Bitwise Bitcoin ETF Trust
NYSE Arca Exchange has filed a revised application to list the Bitwise Bitcoin exchange-traded fund (ETF) Trust. This updated submission includes an extensive academic analysis to address concerns raised by the Securities Exchange Commission (SEC) regarding spot bitcoin ETFs. The NYSE highlighted the SEC’s reference to the “mixed” or “inconclusive” academic record as a basis for rejecting previous Bitcoin ETF proposals.
The filing also pointed out the SEC’s approval of two bitcoin futures ETFs in 2022, where the agency determined that the Chicago Mercantile Exchange (CME) Group’s surveillance measures could effectively detect and address any manipulation attempts in the CME bitcoin futures market, including efforts to manipulate proposed futures ETF prices.
Bitwise disagreed with the notion that there is a mixed academic consensus between spot and futures markets. The exchange argued that well-conducted studies indicate that the CME futures market has a stronger influence on the spot market. Bitwise also emphasized that trading a spot bitcoin ETF would only impact prices in the CME futures market if it significantly impacted prices in the spot market due to their strong connection and arbitrage relationship.
Matt Hougan, Bitwise’s Chief Investment Officer (CIO), expressed skepticism about the SEC’s past rejections of spot Bitcoin ETFs. He highlighted Grayscale’s recent court victory over the SEC, stating that it is crucial for future approvals of spot Bitcoin ETFs. However, he raised concerns about what would happen if the SEC appeals the court decision.
Bitwise Hopes for Approval with Amended Filing
Bitwise’s revised application, submitted by NYSE Arca Exchange, is its latest attempt to gain approval for a spot Bitcoin ETF after two previous failed attempts. This comes in the wake of Grayscale’s successful appeal against the SEC at the U.S. Federal Court of Appeal. While the court ruling is seen as a positive development for the digital asset landscape, it does not guarantee the approval of spot Bitcoin ETFs.
Bitwise hopes that its detailed proposal, which addresses the “mixed” academic record between spot and futures ETFs, may lead to approval from the SEC. The exchange aims to clarify confusion surrounding price discovery in the Bitcoin market and demonstrate the significance of CME to both spot and futures ETFs.
Hot Take: Will Bitwise’s Third Trial Succeed?
Bitwise’s amended filing, supported by NYSE Arca Exchange, represents another effort to obtain approval for a spot Bitcoin ETF. Following Grayscale’s court victory over the SEC, there is hope for a more favorable regulatory environment. However, while the ruling sets a precedent, it does not guarantee immediate approval of spot Bitcoin ETFs.
Bitwise’s revised application aims to address concerns raised by the SEC and provide a comprehensive explanation of the academic record between spot and futures markets. It remains to be seen whether this latest attempt will be successful in gaining regulatory approval for a Bitcoin ETF.
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