CBOE applied to the Securities and Exchange Commission (SEC) to list VanEck’s exchange traded fund (ETF) for Bitcoin. The SEC has so far not accepted any applications for a Bitcoin ETF.
The application form submitted by CBOE Global Markets to the SEC was published in the evening on Monday. In the form where the change of Bitcoin over the years is explained, it is stated that stock exchange investment products (ETP) can solve some problems in the market. Bitcoin price rose 6% within 24 hours.
Can fix the individual investor’s problem
Exchanges in the US have been trying to list a bitcoin-indexed stock market investment product since 2016. CBOE claimed that the bitcoin market, which has grown “100 times bigger” since then, now appeals to a much wider investor base and is much more liquid.
VanEck, which submitted its first ETF application in 2017, repeated this in January 2021. CBOE states that listing this Bitcoin ETF will be beneficial for the individual investor. The individual investor will be able to cross the spot market and enter the cryptocurrency world through the CBOE.
US investors mainly trade through stock exchanges, as it is not an ETF. The CBOE argues that this poses risks in terms of cybersecurity, and a regulated ETF will keep the investor safer.
The evaluation process begins
The SEC must take a decision within 45 days of starting to consider the application submitted by the CBOE. Applications can be approved or rejected within the process, or the process can be extended up to 240 days. The SEC denied all applications for the Bitcoin ETF.
While there is no exchange traded fund in the USA; this year, the first Bitcoin ETF in North America was established in Canada. The fund had almost a billion dollars in volume within a few days.
It is thought that a possible ETF to be established in the USA will increase the number of institutional investors in the sector with the custody service to be offered. While CBOE did not reveal who will provide this service, it stated that it is an organization subject to NYDFS.