SEC Restarts Clock on Proposed ‘Bitcoin and T-Bills’ ETF

The U.S. Securities and Exchange Commission (SEC) is once more soliciting feedback on a proposed exchange-traded fund (ETF) based mostly round bitcoin and Treasury bonds.

According to a public submitting revealed Tuesday, funding administration agency Wilshire Phoenix and NYSE Arca filed an modification to their ETF proposal earlier this month to deal with issuance and redemption for the securities and the itemizing/buying and selling of the fund’s shares.

Coinbase Custody will act because the custodian for the bitcoin held by the belief, in keeping with the submitting. Tuesday’s discover says Coinbase will present attestations confirming the quantity of bitcoin it holds inside 5 enterprise days of the belief’s month-to-month rebalancing, including a element not current within the authentic submitting.

The amended rule change proposal additionally notes that CME and Intercontinental Exchange (ICE) present bitcoin futures merchandise within the U.S., reasonably than CME and Cboe. The latter firm wound down its futures product earlier this yr.

Later on, the submitting seemingly addresses the SEC’s issues with potential market manipulation within the cryptocurrency area.

“The Sponsor notes that, in connection with the Commission’s analysis of whether a market is inherently resistant to manipulation, the Commission has in certain circumstances focused not on the market as a whole but instead on the significant subset of the market that has a meaningful impact on the particular ETP [exchange-traded product],” the submitting says, including:

“For instance, orders approving listing applications of ETPs that invest in gold bullion focused on the spot and futures market, even though gold is traded on a number of different market segments. Focusing on the spot market is appropriate because the spot market is the market to which the particular ETP would look to determine its [net asset value].”

The modification filed on Oct. 4 “replaces … and supersedes” the unique submitting “in its entirety,” Tuesday’s discover stated.

The SEC first kicked off the remark interval for Wilshire Phoenix’s proposal in June, earlier than asserting in late September that it was evaluating the proposal.

According to the submitting, members of the general public should submit feedback inside 21 days of the discover’s publication within the Federal Register. The SEC has 45 days after the submitting’s publication within the Register to make an preliminary determination, however can prolong that timeframe if it chooses to take action.

Tuesday’s submitting follows the SEC’s determination to reject a bitcoin ETF proposal filed by Bitwise Asset Management, additionally working with NYSE Arca. The regulator cited issues about market manipulation and a scarcity of surveillance-sharing agreements as a difficulty in its rejection.

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