A lot of people raise interesting questions when it comes to the impending SEC decision regarding the bitcoin ETF rule change proposal. Although everyone knows the deadline ends on March 13th – due to the 11th being a Saturday – the SEC does not necessarily need to render a decision by any means. In fact, if the government body stays silent, the proposed rule change will take effect automatically.
No Verdict Is Positive News Too
The best outcome of the SEC decision would be a public statement as to how the proposed rule change is approved. People need to keep in mind a positive response does not automatically create the bitcoin ETF out of thin air, as that is not what the rule change itself is about. However, it will lay the foundation to create a bitcoin ETF in the future, which is what everyone is waiting for right now.
At the same time, there are quite a few people who speculate the SEC will reject the proposed rule change. That is their good right, as they have the ultimate decision making power as to whether or not the proposed change is viable. If the SEC deems that is not the case, it is time to head back to the drawing board for every company looking to establish a bitcoin ETF in the future. Depending on whom you ask, this seems to be the most likely outcome.
Interestingly enough, there is a third option very few people seem to be aware of. If the SEC mentions nothing of this proposed rule change by the time this deadline expires on March 13th, it is automatically approved. According to the Rule 19 of the Securities Exchange Act of 1934, the SEC does not need to issue a response regarding this proposed rule change. It seems unlikely this third option will become a reality, but it is something to keep in mind. Rule 19 on page 288 clearly states that:
“(D) RESULT OF FAILURE TO INSTITUTE OR CONCLUDE PROCEEDINGS.—A proposed rule change shall be deemed to have been approved by the Commission, if— (i) the Commission does not approve or disapprove the proposed rule change or begin proceedings under subparagraph (B) within the period described in sub- paragraph (A); or (ii) the Commission does not issue an order approving or disapproving the proposed rule change under subparagraph (B) within the period described in subparagraph (B)(ii).”
Some people may confuse this rule change proposal with the filing provided by the Winklevoss Bitcoin Trust. These are not the same by any means, although both proposals can be approved in quick succession. If the rule change gets through, there is a good chance the Winklevoss Bitcoin Trust will be approved within weeks or even days. Then again, this hinges entirely on which response the SEC will provide to the world if any.
It is understandable a lot of people are excited as the March 13 date draws closer. However, it is important to get all of the facts straight before more market volatility ensues for no good reason. The SEC approval is only the first step along the long way to get a bitcoin ETF listed on an exchange where it can be publicly traded. This battle will not be won on March 13th, even though the date marks one of the most important battles.
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