Bitwise Makes U-Turn, Retracts Bitcoin ETF Application; Here’s Why

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Winston

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Bitwise, a prominent asset manager, recently withdrew its application for a Bitcoin (BTC) and Ethereum (ETH) exchange-traded fund (ETF). This move was unexpected and indicates that the company is reassessing its long-term strategy. Bitwise aims to offer investors capital appreciation, and it is possible that the ETF application was withdrawn because the company is not guaranteed to achieve this objective.

Collaboration and Financial Regulatory Involvement

Bitwise had collaborated with ProShares to launch another ETF when it filed for approval from the US Securities and Exchange Commission (SEC). However, based on the withdrawal statement, Bitwise is no longer interested in pursuing the goals of the fund. It is important to note that no Fund securities have been sold as part of the previously mentioned Post-Effective Amendment to the firm’s Registration Statement.

The SEC has extended the deadline for evaluating Bitcoin ETF applications from several prominent firms, including BlackRock, Fidelity, Invesco Galaxy, WisdomTree, Valkyrie, and VanEck. This extension has left the crypto community waiting in anticipation for the launch of these funds.

Bitwise as an Early Entrant in Cryptocurrency Investing

Bitwise is one of the early asset management firms that sought to introduce cryptocurrency investing to traditional investors. The company applied for Bitcoin ETFs in January 2019, aiming to transform how investors interact with cryptocurrencies. The application proposed monitoring the performance of the platform’s Bitcoin Total Return Index to leverage its value. This index would derive value from multiple Bitcoin transactions occurring on various Crypto Exchanges, providing real-time data on the asset’s performance.

Transparency and Trust in the Cryptocurrency Space

Bitwise’s vision for its Bitcoin ETF extended beyond tracking the value of BTC. The proposed ETF aimed to exemplify transparency and trust in the cryptocurrency space by aggregating Market data from multiple exchanges. This innovative approach would allow investors to gain exposure to both front-time and back-time Ethereum futures, benefiting from the growth and evolution of the Ethereum Blockchain.

Bitwise’s Interaction with the US Financial Regulator

The recent withdrawal of Bitwise’s Bitcoin ETF application is not its first interaction with the US financial regulator. In the same year, the asset manager had previously submitted an application for an Ethereum Strategy ETF. This ETF aimed to expose investors to Ethereum futures, enabling them to benefit from the growth and evolution of the Ethereum blockchain.

Conclusion

Bitwise’s withdrawal of its Bitcoin and Ethereum ETF application reflects the company’s reassessment of its long-term strategy. While the company aims to offer investors capital appreciation, it appears that the ETF application was withdrawn due to the uncertainty of achieving this objective. Bitwise’s early entry into cryptocurrency investing and its innovative approach to transparency and trust have marked its presence in the industry. However, with the SEC extending the review period for Bitcoin ETF applications, the launch of these funds remains highly anticipated by the crypto community..

”analysis-crypto”


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