News has emerged that on June 26 the Securities Exchange Commission in the US received an application for a Bitcoin ETF license from Cboe Global Markets, in partnership with Van Eyck Investment and SolidX.
Although submitted in June, the application for a Bitcoin ETF license has only come to light after publication by the SEC, and an invitation for comments from the public.
Most applications have been rejected
The plan put forward by the Cboe is to offer clients shares in SolidX, which are worth around 25 bitcoin.
Up to this point, many applications of this nature have been rejected primarily on the basis of how unregulated the crypto space is at present.
The last rejection took place in March, despite a direct letter to the SEC written by Cboe Global Markets president Chris Concannon who tried to help alleviate some of the concerns held by the SEC –
“While cryptocurrency-related holdings do raise a number of unique issues, Cboe firmly believes that such holdings do not require significant revision to the well-established frameworks for evaluation related to valuation, liquidity, custody, arbitrage, and manipulation,” Concannon wrote.
This news comes amid speculation that crypto is on the verge of a massive investment drive from institutional investors.
It’s worth noting that the same parties have had other applications rejected previously based on bitcoin being considered unregulated, but the difference now is that the SEC recently commented that Bitcoin and Ethereum are not securities, which may assist in opening the door for them to become tradable as ETF’s.
According to the document, “[The ETF], under normal market conditions, will use available offering proceeds to purchase bitcoin primarily in the OTC markets, without being leveraged or exceeding relevant position limits.”
Clients would also have insurance coverage “underwritten by various insurance carriers” to protect against potential loss or theft of bitcoins held by the ETF –
“The insurance policy will carry initial limits of $25 million in primary coverage and $100 million in excess coverage, with the ability to increase coverage depending on the value of the bitcoin held by the Trust.”
It looks more like a case of when rather than if nowadays, especially with Europe making moves towards launching its own crypto ETFs, and if Cboe manages to succeed the Bitcoin ETF should be open for client investment in the first quarter of next year.
Lover of all things crypto, blockchain and AI, professional tech scribe & part of the editorial team at Crypto Disrupt.