The Cboe BZX exchange has submitted a new proposal to the US Securities and Exchange Commission (SEC) requesting a rule change that would allow for the first bitcoin exchange-traded fund (ETF).
Like the previous proposal, the new document suggests a rule change to a provision outlined in Section 19(b)(1) of the Securities Exchange Act of 1934 that would allow for SolidX bitcoin shares to be listed and traded on a US exchange. The shares would be issued by the VanEck SolidX Bitcoin Trust, which would be responsible for holding the bitcoin that backs said shares.
According to the proposal, "[E]ach Share will represent a fractional undivided beneficial interest in the Trust's net assets." The proposal also states that because each share will cost the same as 25 bitcoin, the company expects that only "institutional and other substantial investors" will be able to afford to invest in the ETF:
"[T]he Shares will be cost-prohibitive for smaller retail investors while allowing larger and generally more sophisticated institutional investors to gain exposure to the price of bitcoin through a regulated product while eliminating the complications and reducing the risk associated with buying and holding bitcoin."
The SEC must make a decision to deny or approve the proposal within 45 days or request an extension of up to 90 days if it needs more time to review the proposal.
The saga of the SolidX ETF has been unfolding since June of last year, when the companies first filed their proposal. The SEC decision on that proposal was delayed until September before being delayed again, with the SEC promising a decision would be made by February 27 of this year. In a surprising turn of events, the companies withdrew their initial proposal just last week.