Economy

What The Withdrawal Of CBOE Bitcoin ETF Means For Bitcoin Prices

What The Withdrawal Of CBOE Bitcoin ETF Means For Bitcoin Prices

Most employees of the SEC have been put on furlough due to the partial government shutdown. This was the final extension that the SEC could have taken - and a final answer was needed by the 27th of February, beyond which the proposal would have stood "automatically approved". The asset manager filed its own Form S-1 with the Securities and Exchange Commission earlier this month.

The U.S. government shutdown now appears to be making it harder for the financial industry to add new products tied to cryptocurrencies.

In a filing posted today, SEC deputy secretary Eduardo Aleman wrote that the Cboe BZX Exchange has rescinded its application for a proposed rule change for a Bitcoin ETF backed by VanEck and SolidX.

Bitcoin price coming under minor downside pressure, as so it seems on this gathering pace of attention across the news wires.

The US Securities and Exchange Commission (SEC) decided late previous year to delay its decision on the bitcoin exchange-traded fund (ETF) proposed by VanEck and SolidX. This is a big blow to those hoping that the much-anticipated exchange-traded fund for Bitcoin (BTC) would bring a fresh wave of investments into the stagnating market. Essentially, the SEC decided that the Bitcoin market was too risky for an ETF, no matter how well-designed the VanEck SolidX Bitcoin ETF was.

CNBC host Bob Pisani pointed out that the SEC has raised several concerns that have to be addressed before they would be comfortable approving a Bitcoin ETF, including custody issues and potential for market manipulation. This is one of the longest shutdowns of the U.S. government ever in history.

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CNBC reported that VanEck's founder and CEO, Jan Van Eck plans to refile the application but can't answer numerous SEC's questions until the government reopens.

The questions centered around how the Bitcoin market can be manipulated, Bitcoin lacks a single global price, there is a lack of exchanges disclosing data to the government i.e. surveillance, and insurance for the Bitcoins.

The letter, which was attributed to SEC Deputy Secretary Eduardo A. Aleman, did not explain why CBOE - which was also the first United States exchange operator to list bitcoin futures - pulled the application.

Gabor Gurbacs, Vaneck's Director of Digital Asset Strategy, also commented on the withdrawal via a recent tweet.

The chairman of the broker-dealer firm Lowenstein Sandler, attorney Ethan Silver explained this decision a little more clearly.