Another Bitcoin ETF Filed, SEC Commissioner Blasts the Agency With “We’re Not A Merit Regulator”
“We shouldn’t be in the business of deciding whether something is good or bad,” said Hester Peirce while the expectation for a 2021 approval wanes.
The latest firm to file a Bitcoin exchange-traded firm is Global X. The Global X Bitcoin Trust will trade on Cboe BZX Exchange under a ticker symbol announced later.
The Trust’s investment objective is to reflect the performance of Bitcoin’s price minus its expenses, a unified fee called ‘Sponsor fees,’ which isn’t decided yet. It, however, does not seek to reflect the performance of any benchmark or index.
For this, it will hold Bitcoin with a custodian, which is not decided yet either, according to the filing.
An unnamed Delaware trust company will act as the Trustee of the Trust, and the Bank of New York Mellon will serve as its administrator and the transfer agent.
The company cautions of the Trust involving “significant risks” and not being suitable for shareholders not in a position to accept risks related to bitcoin.
“The shares are speculative securities,” it said, adding, “their purchase involves a high degree of risk, and you could lose your entire investment.”
Never Have Imagined This Situation
Bitcoin ETF applications continue to pile on the US Securities and Exchange Commission’s (SEC) desk, but the agency has yet to proceed past public comments. It has been eight years, and not a single application has been approved. Since 2017, the SEC has rejected them on the ground of the market being susceptible to fraud and manipulation.
But one SEC Commissioner has enough of that. Hester Peirce, aka ‘Crypto Mom,’ shared her displeasure at this during an online conference, “The B Word,” on Wednesday.
“I would never have imagined that I would be in this situation where we would not yet have approved one, and other countries are moving ahead,” Peirce said when asked about moving forwards with a Bitcoin ETF. She also said that the crypto industry is being forced to play by a separate rule than anyone else.
“We’re not a merit regulator so we shouldn’t be in the business of deciding whether something is good or bad, an investor is thinking of their entire portfolio and sometimes we’re thinking in one-off terms of a particular product standing on its own and we forget that people are building portfolios”
Expectation For 2021 Approval Waning
A Bitcoin ETF would allow retail investors to gain exposure to the cryptocurrency in a cheaper, easier, and tax-efficient manner. Still, it remains to be seen when such an investment vehicle will come to the US.
Greg King, the CEO of Osprey Funds, the issuer of over-the-counter Bitcoin trust OBTC, which filed for its own Bitcoin ETF in 2017, isn’t confident of a Bitcoin ETF coming this year.
“If a Bitcoin ETF is coming through the Gensler administration, my view is it's not going to happen this year. I think there are so many things on their plate, it's going to take them a while to assess the situation,” he said. And the market has been “partially calibrating” to these frustrations with no approval, he added.
Being late than other countries, according to King, is “obviously by choice” as they look at it “more holistically,” beyond just approving but as to what precedent what will be set by approving one.
“But our hope is that it does come eventually. I would just say 2022 is probably the earliest we might see that,” King added.