SEC Extends Deadline on Bitwise ETF Redemption Decision
The SEC Extends Deadline on Bitwise ETF redemptions for Bitwise Bitcoin and Ether ETFs, sparking debate on crypto regulation and market innovation.
The SEC has postponed its judgment on in-kind redemptions for Bitwise’s Bitcoin and Ether ETFs, citing a need for more time to assess the proposed rule change. This decision impacts ETFs listed on NYSE Arca, with the SEC opting to extend its review to better understand the implications of allowing redemptions in cryptocurrency. Under in-kind redemptions, investors could claim Bitcoin or Ether directly instead of cash, a move that may offer potential tax advantages for some market players.
The Commission clarified that the extension falls within its rights, as decisions can legally be extended up to 90 days after an initial 45-day consideration period. Many in the crypto industry see this as yet another instance of regulatory stalling, with frustrations mounting over slow progress and lack of clear direction.
Grayscale’s legal team recently criticized the SEC for halting its Digital Large Cap ETF approval, calling the move a breach of statutory procedure and deadlines. While the product had been greenlit, a later reversal from the SEC’s Office of the Secretary added fuel to concerns about transparency and consistent regulation.
Despite past criticisms, signs point to a shift in regulatory tone under new SEC Chair Paul Atkins, who succeeded former Chair Gary Gensler earlier this year. Atkins has expressed openness to innovation, labeling tokenization as a technology the SEC should encourage instead of resist with vague and punitive rules.
He emphasized the importance of transparent crypto rules that foster innovation, promising that the previous approach of “regulation by enforcement” is over.