The SEC approved the conversion of Bitwise's crypto fund to an ETF but soon halted the process, leaving it uncertain.
Approval and Immediate Suspension
The SEC's Division of Trading and Markets granted accelerated approval for Bitwise 10 Crypto Index Fund’s conversion to an ETF, allowing Bitwise to request an early registration date. However, later that day, SEC assistant secretary Sherry Haywood issued a letter stating the 'order is stayed until the Commission orders otherwise,' indicating that the SEC will internally review its own decision.
Speculation around SEC Motives
The pause has fueled speculation within the industry regarding the SEC's intentions. Some experts believe the approval might have been granted to preempt potential disruptions from Commissioner Caroline Crenshaw or to navigate around the statutory 240-day approval timeline. It's also suggested that the SEC may be delaying conversions while preparing general listing standards for crypto ETFs.
Future of Bitwise Crypto Fund
The SEC also extended its review timeline on in-kind redemption structures for Bitwise’s Bitcoin and Ether spot ETFs, adding to the regulatory complexity surrounding crypto ETF approvals.
The uncertainty surrounding Bitwise's approval in ETF highlights the complex regulation of the crypto industry and raises new questions about the SEC's approval process.
