Bitcoin ETF is coming soon? The Winklevoss brothers said we have been waiting for three years!

The Winklevoss Bitcoin Trust is getting closer to becoming the first bitcoin ETF to be listed on a major stock exchange, but the historic event may come later than some think.

Three years ago, brothers Tyler and Cameron Winklevoss announced the Bitcoin ETF plan, and despite its repeated delays, the Winklevoss Bitcoin Trust continues to attract the attention of the Bitcoin community.

It turns out that while approval for this Bitcoin ETF may be coming, the actual decision may still be months away.

The Winklevoss twins have been trying to apply for a NASDAQ listing for two years. In June this year, the two decided to change their target and transferred the application to the BATS exchange. Two weeks later, as part of the approval process, Jill Peterson, assistant secretary of the U.S. Securities and Exchange Commission (SEC), opened a comment period.

The 45-day comment period ends this week.

ARK investment analyst Chris Burniske told CoinDesk:

“It’s a long and winding road, and while there are certainly a lot of rewards at the end, we don’t know when we’ll get there.”

According to the notice, the SEC had 45 days to approve or disapprove the application, but the financial regulator has now extended it by another 45 days, and then another 90 days.

If the SEC staff is unable to reach a decision within the 180-day period, there will be an additional 60-day extension during which the Commission can still make its own approval.

Regarding the approval date, there was speculation on Reddit after the initial filing. In one post, the poster suggested that the ETF should have made a decision yesterday, which was August 22nd, US time.

Extensions and deadlines

However, since the application form shows that the application was actually made on July 14, the actual first deadline is 8月28日.

If the SEC is unable to make a decision during this period, the time will be extended to October 12.

But Burniske said he did not expect the auditor to make a decision anytime soon because it would be "controversial".

The SEC is currently reviewing multiple digital currency applications, and Bitfinex’s decision to sell its securities to cover a $65 million loss may also affect this decision.

“The SEC will approve it when they feel comfortable, not the minute before,” he said.

Promoting Bitcoin

Some people in the community may question the importance of a Bitcoin ETF because technically, anyone who wants to invest in Bitcoin can easily do so.

But according to bitcoin researcher Spencer Bogart, there are often limitations for institutional investors.

Bogart told CoinDesk that a bitcoin ETF would allow institutional investors to buy bitcoin while still complying with regulators.

There are two things worth mentioning about this advantage. First, another key difference is that unlike other OTC investment opportunities, ETF investors do not need to be accredited. Second, unlike those OTC investments, a Bitcoin ETF will not have a long time commitment, thus reducing day-to-day volatility.

Bogart said:

“If a Bitcoin ETF brings additional funds into Bitcoin, it could drive up the price of Bitcoin and drive growth in hashrate and development funding. Both would help further improve the security of the network, making the Bitcoin network stronger.”

According to Bogart, potential risks associated with using a Bitcoin ETF include having a trusted third party in control of private keys.

“Of course, this in itself is not a new risk,” he added.

There are other concerns about this ETF, and the official deadline for submissions is August 8.

In total, five comments were submitted, none of which outright rejected the ETF application. But the submitters all raised their concerns.

Erik Aronesty, a senior software engineer at Bloomberg and a contributor to the Hyperledger project, suggested that the assets would need to be insured or allow the public to conduct daily audits of the funds.

Other comments expressed concerns about the auditability of the trust, compared it to speculative stocks and Ponzi schemes, and asked whether there would be insurance.

Gil Luria, head of technology research at Wedbush Securities, is skeptical of the ETF, telling CoinDesk:

“Efforts to list a bitcoin ETF have been ongoing for three years, with no signs that regulators will approve the asset.”

Representatives from Winklevoss Capital declined to comment. Neither the SEC nor BATS immediately responded to requests for comment.