The United States Securities and Exchange Commission (SEC) has published an "order instituting proceedings to determine whether to approve or disapprove” the proposed Vaneck Solidx bitcoin exchange-traded fund (ETF). The SEC is asking for further public feedback on issues pertaining to concerns regarding the bitcoin market’s perceived vulnerability to manipulation.
SEC Institutes Proceedings to Rule on Vaneck ETF
The U.S. SEC recently published an "orderinstituting proceedings to determine whether to approve or disapprove a proposed rule change to list and trade shares of Solidx bitcoin shares issued by the Vaneck Solidx Bitcoin Trust.”
The SEC asserts that the "Institution of such proceedings is appropriate at this time in view of the legal and policy issues raised by the proposed rule change,” however, emphasizes that the "Institution of proceedings does not indicate that the Commission has reached any conclusions with respect to any of the issues involved.”
"Rather, […], the Commission seeks and encourages interested persons to provide comments on the proposed rule change,” the order states.
SEC Seeks Public Consultation Regarding Market Manipulation
The Commission is seeking public feedback regarding eighteen specific points pertaining to the exchange, including Vaneck’s "assertions that bitcoin is arguably less susceptible to manipulation than other commodities that underlie [exchange-traded products]”
The SEC states that it "is providing notice of the grounds for disapproval under consideration, adding that "The Commission is instituting proceedings to allow for additional analysis of the proposed rule change’s consistency with Section 6(b)(5) of the Act.”
The Act "requires, among other things, that the rules of a national securities exchange be ‘designed to prevent fraudulent and manipulative acts and practices, to promote just and equitable principles of trade’, and ‘to protect investors and the public interest’.”
SEC Already Received 1,400 Letters Regarding Proposed ETF
The SEC will accept public comments regarding whether the ETF should be approved or disapproved for "21 days from publication in the Federal Register.” The SEC will also accept rebuttals to arguments put forward regarding the ETF for 35 days from publication in the Federal Register.”
The order notes that "As of September 19, 2018, the Commission has received more than 1,400 comment letters on the proposed rule change.”