ETF speculation: How has the SEC behaved in similar situations?

[d5000]

The SEC  is, like many of us know, evaluating a rule change that would enable the creation of the first Bitcoin ETF by the "Winklevii" twins.

Until the deadline for the decision (3-11 or more probably 3-13 - as 3-11 is a saturday) there are few days left. There is disagreement in the community if that means a positive outcome is more likely or not.

The question is, for me: How has the SEC behaved in similar decisions in the past? They are likely to wait until the last day of the deadline? Or do they tend to decide relatively early and so the lack of news is an indication of an approval of the rule change?

If this has been answered before here (or e.g. at Reddit), than I would be glad someone can provide me a link

[BitcoinNewsMagazine]

From memory I can tell you decisions have usually come a few days before the deadline so Wednesday would be key I think. It would be a first if no official announcement is made and COIN is approved by default when the March 13 deadline passes.

[york780]

I have also seen this information on reddit. They said how closer we come to the deadline the outcome of their decision will most likely being negative.

[d5000]

From memory I can tell you decisions have usually come a few days before the deadline so Wednesday would be key I think.

Why exactly Wednesday? I have read a rumour that some "good friend" of another forum member (at least, he's a "Legendary") has mentioned a possible press conference at this day. Is it because of this rumour or are there other reasons?

Anyway thank you .... So you and @york780 think if there is no announcement this week, at March 13 the most probably outcome is a rejection of the ETF, if I understand you right.

[alyssa85]

There are actually three ETFs pending aproval:

https://fintechlab.com.br/index.php/2017/02/07/will-the-sec-approve-a-bitcoin-etf-cryptocoinsnews/

After New York venture capitalists the Winklevoss brothers filed for the first listed Bitcoin ETF with the SEC back in July 2013, two others have done so: finance and technology firm SolidX Partners in July 2016, and Grayscale Investments as recently as the third week of January 2017.

The SEC designated March 11 2017, some three years after the Winklevoss brothers first put the ETF in registration, as the date it should either approve or disapprove the proposed rule change; March 30 for SolidX. Given the delay patterns seen for the first two, the deadline for the Grayscale ETF could similarly be drawn out. The SEC has typically 45 days to approve a measure from the time an application is filed in the federal register. As we’ve seen, this can be considerably prolonged.

As previously mentioned, there are a few reasons the SEC could refrain from approving the new form of investment in its bid to protect consumers and markets:

Past volatility

The SEC could be unnerved by the by the volatility of Bitcoin as an asset. Adam White, General Manager at digital currency platform Coinbase, tracked the volatility of Bitcoin from roughly 2011 in a recent white paper in conjunction with investment firm ARK Invest. The report found daily per cent price changes of 50 per cent. “In contrast, on any given day, stocks and bonds rarely fluctuate by 50 per cent in the absence of a severe financial crisis,” said the report.

A Shady Reputation

Bitcoin prices tended to drop as negative headlines appeared, creating further uncertainty for investors. Such negativity surrounding Bitcoin included:

    numerous Bitcoin gambling sites operate with anonymity and minimal to no regulation. The cryptocurrency’s decentralised status means there is little protection of player funds.
    according to a Reuters report, Anthony Murgio, former operator of coin.mx, this month pleaded guilty to Bitcoin related cybercrimes. These included conspiracy to operate an unlicensed money transmitting business, wire fraud and bank fraud.
    earlier this month, Italian politician Lucrezia Ricchiuti went as far as connecting Bitcoin to money laundering through mafia-controlled gambling sites (during the recent debate in Italian senate on its anti-mafia commission report).
    there have been a number of accounts of Bitcoin exchanges being hacked, one being the story of Bitfinex, a major Bitcoin exchange provider that lost 119,756 in Bitcoins (currently the equivalent of more than $110 million), following a breach in August 2016.

Chinese influence

More than 90 percent of Bitcoin trading activities occur on Chinese shores according to Reuters; the SEC could be wary of approving a new ETF product where prices were indirectly controlled by China

[LFC_Bitcoin]

Interesting so if Wednesday/Thursday passes without an official rejection can we expect a likely approval? I don't see why they'd leave everybody hanging around just to reject it right on deadline day?

[statdude]

This article gives the exact opposite argument you make - that the ETF will most likely be APPROVED if it comes to the last day (while you argue for REJECT).

Although I don't think they have any real evidence supporting that.

https://www.cryptocoinsnews.com/bitcoin-etf-headed-default-approval/

[d5000]

Thank you all. Now we have the whole variety of opinions. Default approval, default rejection, probability that there will be a decision in the coming three days. So it's the paradise for those who have "insider informations". 

What I don't trust very much is the "Cryptocoinsnews" source (the Brazilian article is also based on a CCN article). Not only that it's a biased pro-Bitcoin website. But for example, in February it should have been clear for a cryptocoin website that _not_ 90% of the trading occurs in China. So their journalistic standards seem to be pretty low.

[BitcoinNewsMagazine]

This is all speculation remember. SEC takes insider trading very seriously and I really doubt anyone who knows the decision will leak it. Also only two commissioners at present so they actually may have not made up their minds yet since they have until the 13th to do so.