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SEC’s new avatar asks Bitwise for clarity over prevention of fraud in ETF application

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The United States Securities and Exchange Commission (SEC) continued to delay decisions on Bitcoin exchange-traded funds (ETF). Last year in December, the SEC postponed two major Bitcoin exchange-traded offering proposals. This included NYSE Arca’s “actual” Bitcoin ETF, named Bitwise Bitcoin ETP Trust, and Grayscale Bitcoin Trust’s Bitcoin ETF.

There was a lot of uncertainty since the delay. Although this time, there might be a small twist with the recent application.

SEC’s new avatar

According to a notice to the company on Tuesday, the SEC asked the executives to provide some clarity. It is mainly to understand Bitwise’s steps to prevent share manipulation, fraud and other potential issues in its proposed spot Bitcoin ETF.

In addition to this, the watchdogs even flagged Bitwise Bitcoin ETP Trust’s liquidity and transparency. Further, requested insights on the “suitability” of Bitcoin as the underlying asset for the fund. Now, the firm had 21 days to respond to the SEC’s concerns.

The additional analysis was in-line to offset fraudulent and manipulative acts and practices. That said, this wasn’t the only application that had suffered quite extensively in the past. Over the past two months, the agency rejected applications from WisdomTree, Krypton, SkyBridge and Fidelity.

Frustration

Needless to say, this did cause a sense of frustration amongst the crypto community including Congressmen. In an interview, Tom Emmer hit back at SEC Chair Gary Gensler over the BTC spot ETF debate.

He once said in the past- What Gensler is doing is “intentional” and not “ignorant,” in an attempt to “grow their regulatory jurisdiction over this industry.”

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Shubham is a full-time journalist at AMBCrypto. A Master's graduate in Accounting and Finance, Shubham's writings mainly focus on crypto-regulations across the United States and Europe. Also, a die-hard Chelsea fan #KTBFFH.

Disclaimer: AMBCrypto's content is meant to be informational in nature and should not be interpreted as investment advice. Trading, buying or selling cryptocurrencies should be considered a high-risk investment and every reader is advised to do their own research before making any decisions.