SEC’s Crypto ETF Fiasco: Approved, Then Nope! 😂

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Ah, the grand saga of bureaucracy meets blockchain, straight out of a universe where common sense goes to die. Picture this: the U.S. Securities and Exchange Commission (SEC), in a move that would make even the most seasoned hitchhiker raise an eyebrow, approved Bitwise’s cryptocurrency index fund conversion. But wait, plot twist! They then slammed on the brakes with a stay order, leaving everyone scratching their heads and wondering if the SEC’s coffee machine was spiked that day. 😏

This regulatory rollercoaster had the fund poised for glory as a spot exchange-traded fund (ETF), only to be rudely parked in limbo for “further internal review.” Bloomberg ETF analyst Nate Geraci, bless his soul, called it a “bizarre situation,” which, let’s face it, is like calling the Hitchhiker’s Guide mildly informative. 🚀🤦‍♂️

Regulator’s Backflip Bonanza This Month

Fast-forward to a July 22 filing where the SEC dished out an “accelerated approval” for Bitwise’s Bitwise 10 Crypto Index Fund (BITW) to morph into an ETF trading on NYSE Arca. But no sooner had the ink dried than they hit pause, citing some arcane rule. The official doc droned on: “This letter is to notify you that, pursuant to Rule 431, the Commission will review the delegated action.” Yawn. Or as I like to think, “We’re second-guessing ourselves because why not add more chaos to the cosmos?” 😴

Of course, this isn’t a one-off blunder. It’s the second time this month the SEC played whack-a-mole with crypto dreams, blocking Grayscale’s mixed crypto ETF too. Both got the green light from staff, only for the bigwigs to swoop in and say, “Psych!” under the same dodgy provisions. It’s like the SEC is running a never-ending episode of “Survivor: Crypto Edition.” 🎭

Analysts aren’t holding back their sarcasm. Nate Geraci vented on X (formerly Twitter, because who has time for rebrands?): “Both of these should be allowed to convert/uplist ASAP.” Hear, hear! Meanwhile, the ETF was all set to feature a stellar lineup of cryptos—Bitcoin (BTC), Ethereum (ETH), XRP, Solana (SOL), Cardano (ADA), Chainlink (LINK), SUI, Avalanche (AVAX), Polkadot (DOT), and Litecoin (LTC)—but nope, stuck in over-the-counter purgatory until the SEC sorts out its existential crisis. 📉

Under Rule 431, the SEC can play judge, jury, and executioner on any staff decision, suspending it indefinitely while they ponder upholding, tweaking, or flipping it entirely. No timeline? Classic. It’s as efficient as trying to teach a Vogon poetry. Meanwhile, Bitwise is sitting pretty with $5.79 billion in assets across their crypto ETFs, dominated by their Bitcoin fund at $4.79 billion and Ethereum at $431 million. Impressive, if only they could get this one off the ground without the regulatory equivalent of a cosmic traffic jam. 🚧

Wise Cracks from the peanut Gallery

Stepping into the fray, Scott Johnsson from Van Buren Capital and James Seyffart from Bloomberg Intelligence shared their takes on X. Johnsson mused that maybe the SEC approved it knowing crypto-critic Commissioner Caroline Crenshaw would crash the party, or it was all timed for maximum drama with other deadlines. “Both explanations are the kind of funny business that shouldn’t really be happening,” he quipped, probably while rolling his eyes so hard they orbited the room. 👀

Seyffart chimed in, suggesting the SEC is just stalling, buying time until their generic listing standards are sorted by October 2025. Because nothing says “we’ve got this” like dragging your feet for over a year in the fast-paced world of crypto. It’s almost as if they’re waiting for the universe to expand just to fit all their red tape. 🌌

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2025-07-23 23:36