SEC kicks the can again on Valkyrie Bitcoin Fund

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The Securities and Exchange Commission has once again delayed the deadline for a decision on the proposed Valkyrie Bitcoin Fund back to January 2022. 

The Securities and Exchange Commission has once again delayed the deadline for a decision on the proposed Valkyrie Bitcoin Fund back to January 7, 2022. 

“The Commission finds that it is appropriate to designate a longer period within which to issue an order approving or disapproving the proposed rule change so that it has sufficient time to consider the proposed rule change and the issues raised in the comment letters that have been submitted,”

SEC Statement on Valkyrie Spot Bitcoin Fund

This is not the first time the Valkyrie Bitcoin Fund has faced a delay in the SEC’s approval period, which was most recently delayed earlier in the year.

However Valkyrie did recently gain approval for its Bitcoin futures ETF—the Valkyrie Bitcoin Strategy ETF—after the ProShares and VanEck futures ETFs first gained approval with the SEC. 

What is different about the The Valkyrie Bitcoin Fund though is that this is a Bitcoin spot ETF, meaning approval by the regulator is way more difficult, with a different set of regulatory requirements causing additional challenges to the proposal. 

The main reason is that for futures ETFs, the SEC operates on a “negative consent” model, which means a company’s futures ETF gains approval if the SEC doesn’t object to the product during the necessary time period.

However, Spot ETF’s, like the Valkyrie Bitcoin Fund, require affirmative approval from the SEC, in other words, the regulator has to actively agree that the fund can operate.

What is the Valkyrie Bitcoin Fund?

The Valkyrie Bitcoin Fund is the company’s Bitcoin spot ETF, meaning the fund gives customers shares backed by the underlying asset—in this case, Bitcoin. 

That is fundamentally different from futures ETFs like the Valkyrie Bitcoin Strategy ETF, which gives customers shares tied to a bundle of contracts to buy Bitcoin in the future. 

Given the difference between the two, the Valkyrie Bitcoin Fund is facing a different road to potential approval than its futures counterpart. 

Dylan Leighton

Dylan Leighton

Dylan Leighton is an composer, music producer, sound designer and mix engineer from the United Kingdom. Making music for over 40 years, he creates music for corporate clients, film and video, and his own personal enjoyment. Writing under the artist name Kalliste, he has composed in just about every genre, from hip-hop to funk to classical.

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