The decision on a new VanEck Bitcoin ETF came out Friday after the SEC delayed its determination in September.

The much-anticipated Bitcoin ETF -- this time based on the spot price of Bitcoin instead of Bitcoin futures -- was smacked down by the SEC.

The SEC’s decision is not unsurprising since SEC Chair Gary Gensler, who was thought to have been a booster for digital currencies, has done an about-face on crypto.

On news of the jettisoned ETF Friday, Bitcoin dipped about 1%... and has been choppy since.

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Your Rundown for Wednesday, November 17, 2021...

2022: Year of the Physical Bitcoin ETF

“The SEC rejected VanEck’s filing for a physical bitcoin ETF,” notes CNBC, “saying it still lacked confidence that the bitcoin market was free of manipulation and fraud to approve the product.”

(Which is rich. How confident are you, reader, that stocks themselves are “free of manipulation and fraud”? It’s almost laughable. Almost.)

Two futures Bitcoin ETFs -- the ProShares Bitcoin Strategy ETF (BITO) and the Valkyrie Bitcoin Strategy ETF (BTF) -- started trading at the end October. Plus, VanEck’s Bitcoin Strategy ETF (XBTF), with the lowest fees of the three, started trading yesterday.

Invesco, on the other hand, rescinded its SEC application for its own Bitcoin futures ETF; instead, “Invesco is now looking ahead to the pure-play version,” CNBC says.

“I wasn’t surprised that the SEC rejected the application last week,” says Anna Paglia of Invesco. “I do think that some more regulation is something that the SEC is expecting before approving the next application, but I’m counting on 2022 as the year for a pure-play ETF.”

At the same time, she admits this might be a case of “wishful thinking.”

ETF Trends’ David Nadig agrees: “Until we get clear regulation of the underlying coin markets themselves for U.S. investors, I just don’t think we’re going to cross that hurdle.

“I think a real solid physical bitcoin ETF is probably at least a year off at this point,” he concludes.

Market Rundown for Wednesday, Nov. 17, 2021

S&P 500 futures are down 6 points to 4,695.

Oil is down 1% to 79.93 for a barrel of WTI.

Gold’s up $12.90 per ounce to $1,867.10. 

Bitcoin’s up $280 to $59,885.

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We’ll talk more Friday; until then, take care…

For The Rundown,

Aaron Gentzler
Editor, The Rundown
TheRundownFeedback@StPaulResearch.com