Well, here’s a real downer. If you had high hopes for the possibility of a bitcoin exchange-traded fund (ETF) finally getting approved this October, you can douse those hopes in gasoline and set them on fire. Why? Not because the Securities and Exchange Commission (SEC) has decided against it, not because of any delays, but because the instigators of the ETF proposal – CBOE, VanEck and Solid X – are withdrawing it on their own terms.

 VanEck Pulls Out, No Answer Given

What happened? Seriously, these companies have been trying to get this ETF approved since March of 2017, and now, right as we’re at the end and the SEC is ready to issue a final decision the following month, it just gets yanked out from underneath? How and why does that work?

Those of us really searching for answers haven’t gotten them yet. Neither of the mentioned companies have issued statements explaining the reason for the withdrawal.

It’s unclear if the decision has anything to do with VanEck’s recent addition of a bitcoin trust to the cryptocurrency market. Known as 144A, the product was ETF-like in nature, but only traded a basket of about four bitcoins (worth roughly $40,000 at press time) and failed to make much of a dent in the behavior of BTC traders.

Maybe the company thinks that the unenthusiastic response to its trust will be mirrored should its ETF be approved and introduced for public trading. Either way, VanEck seems to have lost its nerve suddenly, which is a shame considering how much time and energy has been given to the project.

On September 4, the head of ETF products at VanEck Ed Lopez commented that the company was still looking to pursue exchange-traded products in the future, stating:

 We still strongly believe the marketplace and many investors would be better served to have a regulated product out there and this is just one small step towards that and right now it happens to be only available to institutions.

This is the second time the company withdrew its application. The first was in early January when the United States was experiencing a prolonged government shutdown. These circumstances threatened an automatic shutdown of the proposal.

Two other bitcoin-based ETF proposals are currently in the SEC’s hands. The first is from Wilshire Phoenix, while the second stems from Bitwise Asset Management. Both are set to be approved or rejected sometime next month.

 Still Committed to an ETF?

VanEck director of digital asset strategies Gabor Gurbacs has since taken to Twitter to calm digital traders’ nerves. He writes:

 We are committed to supporting bitcoin and bitcoin-focused financial innovation. Bringing to market a physical, liquid and insured ETF remains a top priority. We continue to work closely with regulators and market participants to get one step closer every day.

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