SEC Delays Decision on VanEck SolidX Bitcoin ETF Until Next Year
The U.S. Securities and Exchange Commission (SEC) will delay its ruling on a highly-anticipated bitcoin exchange-traded fund (ETF) until next year, confirming earlier speculation on the matter. While the delay is by no means a confirmation that regulators are warming to the idea of a bitcoin ETF, it does suggest they are taking the matter seriously.
In a notice published on Thursday, the Washington-based regulator said its forthcoming decision on the VanEck SolidX Bitcoin Trust will be pushed back until Feb. 27, 2019.
“The Commission finds it appropriate to designate a longer period within which to issue an order approving or disapproving the proposed rule change so that it has sufficient time to consider this proposed rule change,” the SEC said.
A decision on the hotly debated ETF was expected by the end of December but the extent of public commentary on the matter has forced the agency to extend its time period until the new year. As of Thursday, the agency had received more than 1,600 comments on the proposed ETF. The delay is consistent with earlier reports by Hacked pointing to February 2019 as a likely timeline for resolution.
What make the VanEck-SolidX proposal so intriguing are the safeguards in place to protect investors against fraud and manipulation. The fund also proposes to hold a repository of physical bitcoin as opposed to futures contracts and other derivatives.
In a series of meetings with the SEC, members of VanEck, SolidX and CBOE have argued that the bitcoin market meets the agency’s definition of liquidity and transparency. Last week, the proponents urged the agency to apply the same definition of “significant markets” to bitcoin as it does to other markets that currently enjoy ETF status.
This isn’t the first time that a ruling on the VanEck-SolidX product has been delayed. The SEC has pushed back the deadline repeatedly since the summer while discarding more than a dozen other applications.
Even with an ETF in play, appetite for bitcoin is the lowest it has been in more than a year. The leading digital currency fell below $3,300 Friday for the first time since September 2017. At the time of writing, the BTC/USD exchange rate was averaging $3,296 on virtual currency exchanges. That represents a daily drop of 9.8%.
Trading volumes have climbed well north of $6 billion, with futures dominating the order books. Bitcoin’s market capitalization has fallen to $57.4 billion but its share of the overall crypto universe has risen to 55.1%.
With the breach of $3,600 on Thursday, the next likely target for the bitcoin price is $3,000. Below that level, $2,800 is the next major downside target.
Disclaimer: The author owns bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.
Featured image courtesy of Shutterstock.