Bitwise Retracts Bitcoin and Ether Market Cap Weight Strategy ETF Registration

In a recent submission to the U.S. Securities and Exchange Commission (SEC), Bitwise has decided to retract its registration for its Bitcoin and Ether Market Cap Weight Strategy exchange-traded fund (ETF). The reasoning behind this action remains unknown, but Bitwise’s chief legal officer, Katherine Dowling, briefly noted that the company has postponed plans to launch the fund.

Bitwise Halts Plans for Bitcoin and Ether Market Cap Weight Strategy ETF Launch

Subsequent to the postponement of seven spot bitcoin ETFs, Bitwise Asset Management has rescinded its Bitcoin and Ether Market Cap Weight Strategy ETF, as stated in an SEC filing on August 31, 2023. The digital asset manager submitted the fund to the SEC on August 3, 2023. It relies on a five-year-diluted market cap among other qualifying factors to ascertain the weight of each cryptocurrency.

Owing to the market cap of bitcoin (BTC) and ethereum (ETH), the combined allocation of these crypto assets within the proposed ETF would have been constrained at 75%. The most recent filing presented by Dowling does not divulge any justifications for the company’s withdrawal. The document declares:

The Trust no longer intends to seek effectiveness of the Fund and no securities of the Fund were sold, or will be sold, pursuant to the above-mentioned Post-Effective Amendment to the Trust’s Registration Statement.

Bitwise was one of the seven ETF filings that experienced a delay this past week, which encompassed Wisdomtree, Valkyrie, Fidelity’s Wise Origin, Vaneck, Blackrock, and Invesco Galaxy. Regardless of this setback, Bloomberg’s senior ETF analyst Eric Balchunas mentioned that he and James Seyffart still assign a 75% probability for spot BTC ETF approval in 2023.

It is essential not to mistake the Bitwise Bitcoin and Ether Market Cap Weight Strategy ETF for their spot BTC ETF since it is a physically-backed Bitcoin ETF that monitors bitcoin’s price. This particular proposed fund owns BTC intending to grant investors exposure to the crypto asset’s price fluctuations without directly holding BTC.

The Bitwise spot bitcoin ETF aspires to be listed on the NYSE Arca under the ticker symbol “BITW.” The ticker for the Bitwise Bitcoin and Ether Market Cap Weight Strategy ETF was going to be “BITC,” before the fund was withdrawn.

What do you think about Bitwise withdrawing its Bitcoin and Ether Market Cap Weight Strategy ETF (BITC)? Share your thoughts and opinions about this subject in the comments section below.

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