SEC Postpones Hashdex's Bitcoin-Ethereum ETF Decision
The SEC has delayed its decision on Hashdex's proposed Bitcoin-Ethereum ETF, extending the review period until September 2024.
The U.S. Securities and Exchange Commission (SEC) has postponed its decision on Hashdex’s proposed spot Bitcoin-Ethereum ETF, with a new deadline set for September 2024. The Hashdex Nasdaq Crypto Index US ETF aims to provide investors with direct access to Bitcoin and Ethereum, tracking the Nasdaq Crypto US Settlement Price Index (NCIUSS).
If approved, the ETF will offer direct exposure to Bitcoin (BTC) and Ethereum (ETH) through a passive investment strategy that tracks the NCIUSS. The fund's assets will be solely comprised of Bitcoin and Ethereum, with cash reserves for operational expenses. Coinbase and BitGo will manage custody, ensuring secure storage of the digital assets.
The SEC announced the delay in an official notice on August 9, stating the need for additional time to review the proposed changes and related issues. The decision deadline is now September 30, 2024. Hashdex submitted its initial 19b-4 form in June and an S-1 form in July. This ETF has attracted attention for its market cap-weighted design, which analysts like James Seyffart from Bloomberg Intelligence consider a good option for those seeking diverse digital asset exposure.
The delay comes amid recent activity around options trading for similar ETFs. For example, BlackRock recently filed for options trading on its spot Ethereum ETF via Nasdaq. On the other hand, three exchanges have retracted their applications for Bitcoin ETF options. Seyffart suggests that these withdrawals often precede updated applications.
Eric Balchunas, another analyst from Bloomberg, views these developments as encouraging. He argues that the SEC's engagement rather than outright denial is a positive sign for ETF approval chances. "If they were going to deny it outright, they wouldn’t bother engaging," Balchunas noted. The Hashdex ETF proposal is part of a broader trend where exchanges and asset managers are exploring options for spot Bitcoin and Ethereum ETFs. The SEC's delay adds to the anticipation as the industry awaits potential approval.
The Hashdex Nasdaq Crypto Index US ETF seeks to provide investors with the opportunity to diversify their portfolios by gaining exposure to major cryptocurrencies like Bitcoin and Ethereum. Experts believe the market capitalization-weighted approach offers a balanced strategy. By integrating Bitcoin and Ethereum into a single ETF, Hashdex aims to attract investors seeking broad exposure to digital assets. This combined ETF could serve as a crucial tool for investors looking to participate in the crypto market without directly purchasing individual coins.
The SEC’s postponement reflects the evolving nature of the cryptocurrency market. Approval of this ETF could be a significant step forward for digital asset investment. The outcome of the SEC's review will be closely watched, potentially setting a precedent for future cryptocurrency ETFs and further integrating digital currencies into mainstream investments.
As the new deadline in September approaches, the industry and investors are eager to see the SEC's decision, which could shape the future of cryptocurrency investment in the U.S.
