SEC Delays Decision on Bitwise 10 Crypto Index ETF Until March

SEC Delays Decision on Bitwise 10 Crypto Index ETF Until March

The U.S. Securities and Exchange Commission (SEC) has announced a delay in its decision regarding the Bitwise 10 Crypto Index exchange-traded fund (ETF). This postponement extends the review period to March 3, 2025, citing the need for additional time to evaluate the complexities of the proposal.

Why the Delay?

The SEC’s decision to extend the review period comes in response to a proposed rule change submitted by NYSE Arca, the exchange seeking to list the ETF. Initially slated for a January 17, 2025, deadline, the extension aims to provide regulators with ample time to scrutinize the fund’s design, which is intended to offer investors exposure to a diversified portfolio of leading cryptocurrencies.

About the Bitwise 10 Crypto Index ETF

Managed by Bitwise Asset Management, the Bitwise 10 Crypto Index ETF is designed to mirror the performance of the Bitwise 10 Large Cap Crypto Index. This index comprises the ten largest cryptocurrencies by market capitalization, recalibrated monthly to adapt to market shifts and minimize risks.

The ETF’s primary goal is to streamline cryptocurrency investments for both institutional and retail investors, addressing key concerns such as security and market liquidity. Since its inception in November 2017, the fund has showcased Bitwise’s dedication to creating regulated, accessible crypto investment tools. Despite notable market volatility, the fund has achieved an annualized return of 32.2% as of late 2024.

Challenges in SEC Approval

The SEC has traditionally approached cryptocurrency ETFs with caution due to ongoing concerns about market manipulation, liquidity, and investor protection. These regulatory hesitations have persisted during the Biden administration, despite the growing interest in digital asset investments. NYSE Arca filed its request for the ETF listing in November 2024, but the proposal has not yet received public comments.

Federal regulations mandate that the SEC review such filings within 45 days, with the possibility of an additional 45-day extension if further analysis is needed. The decision to delay highlights the continued regulatory uncertainty surrounding cryptocurrency products.

Implications for the Crypto Market

The new March 3, 2025, deadline is seen as a critical juncture for proponents of cryptocurrency ETFs. Approval of the Bitwise 10 Crypto Index ETF could pave the way for broader adoption of digital asset investment products and provide a clearer regulatory framework for the burgeoning crypto market.

While some speculate that a shift in administration could lead to more favorable policies under Donald Trump, current regulations remain stringent. For now, the SEC’s cautious approach reflects its commitment to ensuring market integrity and protecting investors as interest in cryptocurrency investment tools continues to grow.