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Bitwise Bitcoin ETF Pulled Back As Financial Advisors Remain Spooked By Unclear Regul

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  • Crypto asset manager Bitwise through Bitwise Bitcoin ETF trust request SEC for withdrawal on proposed ETF registration
Bitwise withdrew their proposal to the Securities and Exchange Commission (SEC) from the initial ETF proposal it made to list the Crypto asset manager in the NYSE arca. SEC had previously rejected all Bitcoin ETF due to major concerns in fraudulent activities and market manipulation.
Bitwise’ form S-1 filed on January 10th 2019 as per the SEC statement released on 14th Jan 2020 read,
“AT THIS TIME, THE REGISTRANT HAS DETERMINED NOT TO PURSUE THE REGISTRATION AND SALE OF THE SECURITIES COVERED BY THE REGISTRATION STATEMENT. THE REGISTRANT BELIEVES THAT THIS WITHDRAWAL REQUEST IS CONSISTENT WITH THE PUBLIC INTEREST AND PROTECTION OF INVESTORS AS REQUIRED BY RULE 477(A) OF THE ACT AND REPRESENTS, IN ACCORDANCE WITH RULE 477© OF THE ACT, THAT THERE HAS BEEN NO ISSUANCE, DISTRIBUTION OR SALE OF THE SECURITIES UNDER THE REGISTRATION STATEMENT.”
However Bitwise’ proposal wasn’t the first of its nature. SolidX was the first Blockchain Company to file with the SEC in partnership with VanEck a money managing firm.
With their initial rejection Bitwise tried to deal with market manipulation SEC’s major concern. The regulatory watchdog had in November 2019 promised to take a look into the initial rejection but are seem to not yet be convinced that Bitwise had complied with the set standards. Had the proposal sailed through, it would have enabled Bitwise through Bitwise Bitcoin ETF trust to trade based on data drawn from large crypto exchanges. Bitwise stated that the index drawn from the said data above and would aim to capture the gross return available to investors.
The regulatory uncertainty spread across the market was captured in Bitwise latest report that showed over 42% of financial advisors said regulation is their biggest barrier in adopting blockchain and cryptocurrencies. The survey which collected data in Dec 2019 from 415 respondents in the financial field, financial advisors shared their optimism in the crypto markets but remained distant in adopting the new technology.
Only 6% stated that they currently have clients’ funds in the crypto markets while the majority were almost certain they wouldn’t invest in crypto yet. This dwarfed the 7% who claimed they would definitely invest in the crypto markets 2020. With the regulatory concerns 42% cited regulation uncertainty is a major problem while the 58% indicated that proper regulation would indeed encourage investment.
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