After nearly two years, Bitwise Asset Management has once more announced that it has applied with the United States Securities and Exchange Commission (SEC) to create a Bitcoin exchange-traded fund (ETF).
The investment company withdrew its application for a physically-backed BTC ETF in 2020. However, it has already got approval for a fund that enables it to offer investors exposure to firms operating within the cryptocurrency and blockchain industry.
In an October 14 announcement via Twitter, Matt Hougan, the Bitwise chief investment officer, said that the investment company will be pursuing a Bitcoin ETF with NYSE Arca. Hougan said that Arca holds ‘real bitcoin’ and not derivatives or any other indirect exposure to cryptos.
He said that the Bitwise team has now spent at least two years analyzing the company’s potential and ability to ‘surveil and enforce’ any efforts of manipulation Hougan concluded that the Chicago Mercantile Exchange (CME) is a “regulated market of significant size” for the cryptocurrency market.
The Bitwise CIO said:
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“The market has matured. An actual BTC ETF can now be approved.”
Based on the filing with the SEC, the company reportedly plans to register up to 1,000 shares of its Bitwise Bitcoin ETP Trust. It will do the registration with a proposed maximum offering price of $25. The latest SEC filing indicates that the firm will utilize the CME U.S. Reference Rate as a price reference for BTC in the trust.
Previous Bitwise ETF Applications
Reports indicate that Bitwise first applied for a BTC ETF registration with the US SEC in January 2019. Nonetheless, the regulator rejected that proposal in October 2019. Later, the SEC said that it would review its decision. Bitwise decided to withdraw its application in 2020 after the regulator kept the proposal on standby for several months.
At that time, Hougan mentioned that Bitwise was planning to refile “at an appropriate time” after the company had addressed some of the watchdog’s worries raised in the initial filing.
Although Bitwise is yet to refile its application with the SEC for an ETF that comes with direct exposure to BTC since the 2020 withdrawal, the firm unveiled a Crypto Industry Innovators ETF in May 2021. This ETF offers investors significant exposure to some of the largest publicly listed companies operating in the crypto and blockchain sector.
This fund was based on Bitwise’s Crypto Industry Innovators 30 Index that tracks top companies “engaged in actual, material activity in the crypto sector.”
SEC’s Gary Gensler has pointed out that he might be more open to accepting ETFs that are based on cryptocurrency futures as opposed to those that are based on direct exposure. The US watchdog is yet to approve any application that has been filed for a physically-backed BTC ETF.
Nonetheless, in the past week, the SEC approved an application for the Volt Crypto Industry Revolution and Tech ETF that offers investors access to firms with considerable bitcoin exposure.