Another Bitcoin Exchange-Traded Fund (ETF) proposal rule change, this time one presented by Reality Shares ETF Trusts, is being withdrawn, according to a note submitted to the United States Securities and Exchange Commission (SEC). The ETF proposal would have mixed Bitcoin futures with debt instruments.
The withdrawal was made at the request of SEC staff members and verified by the firm’s lawyer, who said to CoinDesk,
I can confirm that we did withdraw it and it was withdrawn because the staff are still taking the position that it’s not appropriate to file a registered 40 Act fund with cryptocurrency exposure at this time.
According to the lawyer, the SEC staff members were concerned with one particular act under which the rule change was field under. Proposals submitted under the Investment Act of 1940 must be approved within 75 days, and this was the reason for the withdrawal request. This proposal also differs from the other proposals in that it falls under Investment Management (IM) because it is filed under Act 40, as opposed to the others, which would have had the proposal examined by the Division of Corporate Finance.
Reality Shares is a division of Blockforce Capital, a San Diego-based US asset management firm that was launched in 2014. The firm offers several investment vehicles for cryptocurrency. The entity is advised by the likes of Erik Voorhees, an extremely well-known cryptocurrency expert.