Bitcoin ETF regains hope as SEC approves reconsideration petition

The Winklevoss twins' application for listing a Bitcoin ETF on the Bats BZX Stock Exchange has been full of twists and turns. After being rejected by the U.S. Securities and Exchange Commission (SEC) on March 10, the Bats BZX Exchange submitted a petition asking the SEC to review the decision. On Monday this week, the request was finally approved by the SEC.

SEC approves review application

Following the SEC’s rejection of the Coin ETF’s listing application, Bats BZX Exchange filed a “Notice of Intent to Apply for Review” on March 17, and then filed a “Petition for Review” on March 24. According to the Securities and Exchange Commission (SEC), exchanges can file objections to the Commission under SEC Rules 430(b)(1) and 430(b)(2).

After a month of waiting, the SEC finally criticized the petition of Bats BZX Exchange. The “reexamination order” was published on Monday, and the Commission wrote:

“The SEC approved BZX Exchange’s petition to review its proposed rule change.”

In addition, the SEC is allowing anyone to file documents supporting or opposing the authority’s decision on or before May 15. Meanwhile, orders opposing the proposed rule change should remain in effect, the commission wrote.

Petition for Bats BZX Exchange

In the petition filed by Bats BZX Exchange, the exchange stated that the decision of the authority was “patently erroneous.”

The exchange claims that the standards adopted by the SEC in its disapproval decisions are inconsistent with those of its previous approvals, and even in some places, the requirements adopted by the SEC are not based on the Securities Exchange Act. Bats Exchange believes that the licensing agency has also largely exaggerated its concerns about Bitcoin operations.

The exchange then persuaded the Commission to review their decision and proposed a change to its rules. In addition, the exchange argued that its proposed rule change complied with the Exchange Act and was consistent with other approved commodity exchange-traded products (ETPs), BATS concluded:

“BATS believes the Commission should approve this proposal, regardless of the staff’s views, to ensure that it is consistent with the Exchange Act and previously approved ETPs, and that investors can access Bitcoin through a regulated, transparent investment vehicle.”

At the same time, the SEC also rejected the listing and trading application of the Olidx Bitcoin Trust on the NYSE Arca. However, unlike the Bats BZX exchange, the NYSE Arca did not file a review application with the SEC.

Currently, the SEC still needs to make a decision on Barry Silbert’s Bitcoin Investment Trust. On March 25, the SEC stated that it would decide whether to approve the Bitcoin ETF on May 10, but did not rule out further delays.

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