For the past several months, the crypto community was waiting for an event that was believed to be the next step for the crypto growth. The event in question was a decision that was to be made by the US SEC regarding the possible approval of a Bitcoin ETF.
While there were many Bitcoin ETF requests submitted for approval in the last year that got rejected, one application, in particular, submitted by CBOE and backed by VanEck and SolidX, attracted a lot of attention, and after many delays, the SEC was supposed to provide their decision till February 27th, 2019. However, a twist occurred two days ago, on January 22nd, when the application was withdrawn by the very entities that filed it in the first place.
Reasons Behind The Withdrawal
The decision came as a surprise. A spokesperson from the CBOE stated that the decision to withdraw the request came due to the US government long-lasting shutdown. According to them, the date of the decision was approaching, and the government still has numerous issues of its own to take care of. Because of this, the firm has decided to withdraw their request, and re-submit it once the situation has been handled.
The Market Response
The situation regarding the Bitcoin ETF approvals might not depend on this particular application as much as everyone had previously believed. In fact, there are, and there will be many other ETF requests, submitted by other companies and entities. Some applications that can be mentioned are the Winklevoss twins’ ETF, Bitwise, as well as several proposals similar to this coming from European countries, Japan, and others.
In other words, while the CBOE request was believed to be the most interesting one, other applications are developing.
Another interesting thing to note is that the news did not affect the price of Bitcoin nearly as much as everyone believed it would. For months, experts thought that the approval of Bitcoin ETFs might ignite a new Bitcoin rally, as institutional investors were expected to start investing in the crypto space.
While no one foresaw this outcome, the price of BTC was barely affected at all. The coin’s price has dropped slightly, with a small correction that followed almost immediately afterward.
A recent survey on Twitter concluded the above: 81% voted that they do not care about the ETF proposal being withdrawn.
— Alex Saunders 🇦🇺👨🔬 (@AlexSaundersAU) January 23, 2019
It appears that for now at least, the withdrawal did not affect the market nor crypto investors. While CBOE still plans to re-submit the request at some point in the future, there is an equal possibility that some of the other applications might be approved first. However, before that happens, the US government will have to deal with the current shutdown which has had far more significant consequences than the withdrawal.