Fundstrat’s Thomas Lee: The Countdown For Another Bitcoin ETF With Major Backing Has Begun


The Countdown For Another Bitcoin ETF Has Begun

NYSE-Backed Bitwise Bitcoin ETF Filing Moves Forward

Now, we are off with yet another Bitcoin exchange-traded fund (ETF) as the US Securities and Exchange Commission (SEC) announced that it has begun its review of the Bitcoin ETF rule change proposal filed by the NYSE Arca and the leading crypto-focused investment group Bitwise Asset Management.

The proposal was filed on February 11 and was published in the Federal Register on February 15 and now the regulator has 45 days to make the decision on whether the proposal will be approved, rejected or simply extended. At most, the SEC has 240 days to make the final decision on the approval or rejection on the Bitcoin ETF.

Meanwhile, the general public has three weeks to submit any comments regarding the rule change proposal. Just like Gold ETF, proponents believe Bitcoin ETF will not only push the leading cryptocurrencies prices upward but more specifically would bring increased liquidity and new investors in the market.

Bitwise and NYSE Arca had announced their plan to launch a Bitcoin ETF earlier this year saying, “Firm believes it can provide the SEC with the type of information and data the agency has indicated it needs to fully evaluate bitcoin ETFs.”

At that time, John Hyland, the Global Head of Exchange-Traded Funds for Bitwise had shared his optimism for a 2019 ETF approval, “While there can be no assurance that the 19b-4 application will be granted or the SEC will review and ultimately accelerate the registration statement, we are optimistic that 2019 should be the year that a bitcoin ETF launches.”

The company had filed for the rule change proposal the same day but due to the government shut down the SEC couldn’t publish the filing but that changed as it is finally published and now the countdown has once again begun.

Awaiting For SEC’s Green Light

The proposed Bitcoin ETF by Bitwise would be tracking the Bitwise Bitcoin Total Return Index for the full value of an investment in Bitcoin. As for how it is different from previously filed Bitcoin ETFs, this one will rely on “regulated third party custodians to hold its physical bitcoin.” While, NYSE Arca, here will file the application to list shares of the Bitwise Bitcoin ETF.

Recently, Ric Edelman, the founder of Edelman Financial Engines appeared on CNBC and shared that the approval of a Bitcoin ETF is “inevitable.

“It's virtually certain. The only question is when,” said Edelman. “The SEC has several legitimate thoughtful concerns that the industry has to overcome but I'm confident they will. Eventually we will see a bitcoin ETF and it's at that stage that I will be much more comfortable recommending that ordinary investors participate.”

According to Edelman, the interest and investment by major financial institutions mean, it will eventually come to the market.

“We've got some serious players. Fidelity has made a major announcement in the custody issue. We've got Kingdom Trust and a number of other very serious players on the custody side. I'm confident that in very short order VanEck or Bitwise will satisfy the custody concern to the SEC,” added Edelman.

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