Bitcoin Global News (BGN)
January 10, 2019 -- ADVFN Crypto NewsWire -- Last August, the SEC rejected nine Bitcoin ETF proposals, citing the idea that under the existing Exchange Act, the agencies involved in these ETFs had not done enough to mitigate against fraud and other illicit acts. To this, they added that the exchanges involved had also not even established adequate rules related to the prevention of these issues.
Over the course of the second half of 2018, it seemed as if nothing would change related to ETF approvals. Time and time again, we heard news that seemed to indicate the drafting of a promising proposal and time and time again, we were disappointed by another SEC delay or rejection.
Then came 2019. More specifically, today, CoinDesk broke the news that all of this could be about to change due to the work of a company called Bitwise. According to the piece in question, Bitwise is reasonably confident that they have the answer to the SEC’s regulatory concerns with their new ETF proposal. Why they feel this way boils down to how the crypto involved in their ETF will be stored, versus how the crypto involved in all of the past ETFs would have been stored.
Concretely, the difference between Bitwise’s ETF and all of the rest thus far is quite straightforward. Reportedly, Bitwise will have what are called “regulated third-party custodians” store Bitcoins directly in the ETF. Therefore, to believe that this is truly a point of differentiation, we have to also believe that no other ETF proposal has mentioned this, as of yet.
Given that Bitwise has been waiting out all of the other ETF bids and structuring theirs in response to how the SEC has reacted to them over time, their reasoning seems likely to be true. Since the first step of their proposal has already been filed, over the next few months, we will truly be able to see what comes of it.
By: BGN Editorial Staff