Several asset managers, including Bitwise, were attempting to introduce Bitcoin exchange-traded funds in the US. In a move that has left the cryptocurrency community buzzing with speculation, Bitwise has taken an unexpected step. The asset management firm has formally requested the withdrawal of its application for the Bitcoin and Ether Market Cap Weight Strategy exchange-traded fund (ETF), a filing originally submitted to the United States Securities and Exchange Commission (SEC) on August 3.
This abrupt change in direction comes as the crypto market experiences a surge in optimism following Grayscale’s recent victory against the SEC. While market conditions appeared to favor the launch of the ETF, Bitwise has decided to reevaluate its game plan. The withdrawal, though unexpected, came with a statement underscoring the fund’s objective, which is to provide investors with capital appreciation. However, it cautioned that there are no guarantees of achieving this goal.
Bitwise’s Chief Investment Officer Speaks Out
Bitwise’s Chief Investment Officer, Matt Hougan, had been actively advocating for the SEC’s approval of all ETFs in the crypto space. The ETF in question was designed to invest in either Bitcoin futures contracts or Ether futures contracts, with the selection determined by market capitalization dynamics. Remarkably, Bitwise had also joined forces with ProShares to launch another ETF around the same time.
The withdrawal statement from Bitwise reads: “The Trust no longer intends to seek effectiveness of the Fund, and no securities of the Fund were sold, or will be sold, pursuant to the above-mentioned Post-Effective Amendment to the Trust’s Registration Statement.”
Related: Grayscale and Bitwise distance themselves from Ether futures ETF plans
SEC’s Ongoing Deliberations and Bitwise’s Past Withdrawals
As Bitwise reevaluates its ETF strategy, the SEC continues to deliberate on various Bitcoin ETF applications. The commission has decided to extend its review period for several prominent ETFs, including those from WisdomTree, Invesco Galaxy, Valkyrie, VanEck, BlackRock, Bitwise, and Fidelity.
The SEC’s next set of deadlines is slated for mid-October, but there’s potential for further delays, pushing decisions into January or even to the final possible decision dates in March, April, and May of the following year.
Bitwise has a history of strategically withdrawing applications. Earlier this year, it had submitted an application for an Ethereum Strategy ETF aimed at investing in both front-time and back-time Ethereum futures. However, just one week after filing, the asset management firm withdrew the application, highlighting the dynamic and ever-evolving nature of the cryptocurrency ETF landscape.