SEC Calls BlackRock, Fidelity Bitcoin ETF Applications Inadequate: WSJ
According to a report from the Wall Street Journal, the U.S. Securities and Exchange Commission (SEC) has expressed dissatisfaction with the recent influx of applications for Bitcoin exchange-traded funds (ETFs).
According to individuals who are knowledgeable about the situation, the recent report from the Wall Street Journal suggests that the chief overseer has expressed concerns about the lack of clarity in the applications. This statement is quite surprising considering that various companies, including the largest asset management firm BlackRock, have submitted applications for a Bitcoin exchange-traded fund (ETF) this month.
According to an anonymous insider, the SEC holds the view that the applicants for a Bitcoin ETF have not provided sufficient details about their plans to handle a "surveillance-sharing agreement." This agreement aims to prevent fraudulent activities and manipulation by making sure that the issuer of the fund is actively monitoring market trading, clearing, and customer identification. Up until now, the SEC has expressed their dissatisfaction with all the Bitcoin ETF proposals in terms of meeting this requirement.
The participation of BlackRock in the competition led to a sudden increase in the price of Bitcoin, prompting several other prominent investment managers to join in. Just recently, Fidelity, a leading company based in the United States, officially applied to enter the market. Additionally, Invesco, Wisdom Tree, Valkyrie, and Bitwise have also taken similar steps by submitting their own applications.
There is currently no Bitcoin ETF available in the United States due to the Securities and Exchange Commission's hesitance to grant approval. The governing body argues that the susceptibility of Bitcoin's price to manipulation serves as a key obstacle.
However, experts believe that investors are interested in gaining access to such a product as it would enable them to participate in Bitcoin without the hassle of handling the asset's custody.
Fidelity stated in their submission yesterday that the offering would assist investors who desire involvement in the realm of cryptocurrencies to circumvent hazards.
An exchange-traded fund (ETF) is a financial product designed to mirror the performance or value of an underlying asset, such as precious metals like gold, various foreign currencies, or even the increasingly popular digital currency called Bitcoin.
However, the Securities and Exchange Commission (SEC) recently granted approval for the inaugural leveraged Bitcoin futures exchange-traded fund (ETF). As a result, the Volatility Shares 2x Bitcoin Strategy ETF (BITX) was made available for investment on the Chicago Board Options (CBOE) BZX Exchange, commencing on Tuesday.
