SEC Seeks Public Opinion on Spot Bitcoin ETF

The SEC has released a request for public comment on the application for a spot bitcoin ETF by Ark Invest and 21Shares. This request delays the decision on the ETF beyond the expected August deadline. The SEC is seeking input on concerns regarding market manipulation and the liquidity and efficiency of bitcoin markets.

The SEC wants to know if the CME bitcoin futures market is a “regulated market of significant size” for the spot ETF.
Feedback on the liquidity and efficiency of bitcoin markets is also requested.
The agency is asking for plans from the ETF sponsors to share surveillance data with the SEC.
Written data, views, and arguments can be submitted within 21 days.
This is another obstacle in the approval process for a spot bitcoin ETF that has been ongoing for years.

Approval of a spot bitcoin ETF has been delayed due to concerns about manipulation and insufficient regulation. The SEC has previously approved bitcoin futures ETFs but has been hesitant to approve spot funds. The SEC will consider the public feedback before making a final decision on the Ark and 21Shares application. According to Eric Balchunas, a senior ETF analyst for Bloomberg, the SEC’s move is a standard procedure.

Hot Take:

The SEC’s request for public opinion on the spot bitcoin ETF application further delays the decision and highlights the regulatory concerns surrounding the crypto market. While the ETF would provide a safer option for mainstream investors, the SEC is cautious about potential manipulation and the overall stability of bitcoin markets. This request for public input shows that the SEC is taking these concerns seriously and wants to gather as much information as possible before making a decision. The crypto industry will have to wait longer for a spot bitcoin ETF, but it is a necessary step in ensuring investor protection and market integrity.