CBOE Files For Bitcoin ETF License With SEC
United States regulator, the Securities Exchange and Commission (SEC), has received an application for a Bitcoin ETF (exchange-traded fund) license from Chicago Board Options Exchange (CBOE) Global Markets. While other applications have been turned down by the watchdog, a Bitcoin ETF looks like it will have a better chance of success.
This comes amid much speculation of financial funds moving to directly offer cryptocurrency investment vehicles beyond the futures contracts that are currently on offer, which has fueled a widespread opinion that crypto is on the cusp of a massive investment wave from institutional investors.
SEC requested comments on the application on 26th June. The proposal will only be trading with SolidX BTC Shares. Each share will be worth 25 Bitcoin. This will enable consumers to see the trading options only by the first quarter of 2019 upon approval.
“According to the Registration Statement, the Trust will invest in bitcoin only. The activities of the Trust are limited to: issuing Baskets in exchange for the cash and/or bitcoin deposited with the Cash Custodian or Trust, respectively, as consideration; purchasing bitcoin from various exchanges and in OTC transactions; delivering cash and/or bitcoin in exchange for Baskets surrendered for redemption; maintaining insurance coverage for the bitcoin held by the Trust; and securing the bitcoin held by the Trust.”
In the past, the SEC has taken a rather hard stance on crypto-backed funds. Many license applications have been rejected. Two applications filed by VenEck SolidX BTC Trust were rejected in March of 2017. The rejection took place on account of the violation that the cryptocurrency market was wholly unregulated.
The difference now is that the SEC recently commented that Bitcoin and Ethereum were not securities, which may help open the door to them becoming tradeable as ETFs.
Cboe were among those to first launch BTC futures trading last December. Among their rejected applications, the last one was turned down in March. Other major entities like the Winkelvoss twins’ funds have attempted to get over the final hurdle of the SEC license, so it is hoped that the recent comments from the SEC will change matters.
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