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BY Fintan Ng - October 6, 2018

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Nov 5 deadline for comments on nine bitcoin ETFs

SEC continues strict stance on token sales, including STOs
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The US Securities and Exchange Commission (SEC) has designated Nov 5 as the last day for interested parties to comment on the nine bitcoin-based exchange traded funds (ETFs) that filed to make rule changes for listing their securities.

Three separate public documents dated Oct 4 from the SEC signed by assistant secretary Eduardo Aleman ordered that interested parties, in accordance to the regulator’s Commission Rule of Practice 431, has until Nov 5 to file a statement in support or in opposition to the ETFs.

The SEC had issued a stay on the rejection of proposed rule changes for the nine ETFs on Aug 22, a day after disapproving the proposed rule changes.

Interestingly, in the latest filings, the SEC ordered that the earlier decision disapproving the rule changes “remain in effect pending the Commission’s review”.

In late September, the SEC had also instituted proceedings to determine whether Cboe BZX Exchange’s proposed rule change on behalf of SolidX ETF issued by VanEck and SolidX should be approved or disapproved.

The proceedings effectively postponed for a second time a decision on the SolidX ETF, seen by the market as the best candidate for listing given that the ETF it involves the trading of actual bitcoins rather than futures and is focused on institutional traders instead of retail.

Most in the market now believe that no crypto-related ETF will be listed this year as regulators continue to grapple with the issues surrounding the assets and US lawmakers try to push for a clearer regulatory framework.

To recap, the nine bitcoin ETFs in question were the listing of five ETFs to be issued by Direxion, an asset manager specialising in non-traditional ETFs and mutual funds, two ETFs to be issued by the GraniteShares ETP Trust and two ETFs to be issued by ProShares Trust II.

NYSE Arca filed the proposed rule changes on behalf of Direxion and ProShares while Cboe BZX Exchange filed on behalf of GraniteShares.

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