US SEC delays verdict on Grayscale application

TL; DR Breakdown

• SEC delays verdict on Grayscale Bitcoin ETF
• The agency wants a public consultation period
• The SEC prefers futures linked ETFs

Exchange-Traded Funds became very popular across the world last year after Canada took the lead by approving two companies. Before then, the United States SEC has always slugged it out with companies applying to launch their ETF. In a recent update, the US SEC has again held off in its decision to release a verdict concerning the recently submitted Grayscale Bitcoin ETF. According to the SEC, its previous concerns related to manipulation and the likes are still valid.

The SEC wants public consultation

In a statement that the regulatory body released yesterday, it made its worries known about how Grayscale would turn its Bitcoin Trust into a Bitcoin ETF. This shows that the SEC is not yet convinced even though the company drew out a plan to tackle issues that might arise from the ETF.

However, the SEC has thrown this issue to a larger audience, allowing interest parties a full 21 days from the day of its publication to make their interest known. Giving his reaction, Anthony Pompliano took to Twitter to announce the sad news to his thousands of followers. Although much of them were against the ruling, a minor part of the population was thinking the same way as the agency.

The SEC prefers futures linked ETFs

In October, a previous report went round after Grayscale announced that it had applied for a Bitcoin ETF to the SEC. The application specifically outlined the method it would take to convert its Grayscale Bitcoin Trust to an ETF. After about three months back and forth, the SEC is announcing a hold off on releasing its verdict on the submitted application. The SEC is also treating a similar application submitted by Bitwise.

Grayscale continues to make strides in the market after racking up over $36 billion in assets under management. However, the company holds 71% of the assets in GBTC products. Although the SEC has shown worry lines over a spot Bitcoin ETF, the regulator always has preferred futures. The SEC further established this by approving its first ETF, Proshares. In the months that followed, the agency approved VanEck and Valkyrie ETFs.