In a recent development that has become a pattern for the U.S. Securities and Exchange Commission (SEC), the regulatory body has again delayed deciding on a high-profile bitcoin exchange-traded fund (ETF) proposal. This time, the delay affects the proposal from Franklin Templeton for its bitcoin ETF, adding to a series of similar postponements for other cryptocurrency ETFs.
Ongoing delays in cryptocurrency ETF approvals
The SEC’s latest filing, which was unexpectedly delayed in its appearance on the SEC’s website until late Friday, pertains to the proposed rule change for the Franklin Bitcoin ETF. This ETF is intended to be part of the Franklin Templeton Digital Holdings Trust. The delay was somewhat anticipated, following the SEC’s recent pattern of postponing decisions on cryptocurrency ETFs, including those from Hashdex and Global X earlier in the week.
Franklin Templeton’s proposal, which was initially published for public comment in the Federal Register in October, marks the company as one of the latest entrants in the race to launch a bitcoin ETF. This move follows in the footsteps of other major financial players like Ark, BlackRock, and WisdomTree, all of whom have shown interest in the burgeoning cryptocurrency ETF space.
The SEC’s tightening grip and future deadlines
In the filing, the SEC has set a new deadline of January 1, 2024, to decide whether to approve, reject, or continue to deliberate on the Franklin Bitcoin ETF proposal. This extended timeline reflects the SEC’s cautious approach towards cryptocurrency ETFs, a stance that has been consistent across various proposals.
Earlier in the week, the SEC also postponed decisions on other significant cryptocurrency-related ETF proposals. These included Grayscale’s spot Ethereum ETF and Hashdex’s Ethereum ETF, alongside the delay of Hashdex’s bitcoin ETF proposal. Each decision underscores the SEC’s ongoing hesitancy to embrace cryptocurrency ETFs without thorough scrutiny fully.
The situation with Global X’s proposal is slightly different. The SEC has initiated a 35-day comment period that will begin once the filing is published in the Federal Register. Given the usual processing time for such publications, this could set a decision deadline for the Global X proposal sometime in mid to late December, slightly ahead of the January 1 deadline for other delayed proposals.
Expanding horizons: BlackRock’s entry into Ether ETF
Amidst these delays, there has been a notable development from BlackRock, the world’s largest asset manager. BlackRock has filed an S-1 for a spot ether ETF, signaling its intention to expand its presence in the cryptocurrency ETF arena. This move indicates not only BlackRock’s continued interest in the Bitcoin ETF race but also its ambition to pioneer an ether ETF.
BlackRock’s entry into the ether ETF space is significant, given the company’s size and influence in the global financial markets. This could potentially accelerate the acceptance and integration of cryptocurrency ETFs into mainstream investment portfolios.
Conclusion
The SEC’s pattern of delaying decisions on cryptocurrency ETFs reflects a cautious regulatory approach in a rapidly evolving and often volatile market. While these delays may be frustrating for companies and investors eager to see these products come to market, they also indicate the SEC’s commitment to thorough review and consideration. As the landscape for cryptocurrency ETFs continues to develop, all eyes will be on the SEC’s next moves and the potential impact on the future of digital asset investing.
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