The introduction of bitcoin spot exchange-traded funds (ETFs) has been a fundamental development in the cryptocurrency market, but some ETF issuers have not responded to certain requirements, leading to their application being rejected.
SkyBridge bitcoin ETF App Abandoned
Amid growing adoption of bitcoin spot ETFs, investment management firm sky bridge capital has taken a heavy blow as the United States Securities and Exchange Commission (SEC) declared its First Trust-SkyBridge's btc ETF Trust abandoned.
Bloomberg Intelligence senior ETF analyst and cryptocurrency advocate Eric Balchunas took to social media platform X (formerly Twitter) to share development with the cryptocurrency community.
Eric Balchunas revealed that the SEC is ordering the First Trust SkyBridge bitcoin ETF to declare its filing “abandoned.” According to the Bloomberg insider, he is not sure of the reason for the event, as First Trust was “one of the contributors that abstained from participating in the post-BLK race. “
He further noted that First Trust SkyBridge bitcoin ETF Trust would have increased fund inflows by possibly 15% if the SEC had approved the ETF's launch “as First Trust is a sales machine.”
In the screenshot of the filing shared by Balchunas, the SEC stated that “SkyBridge has failed to comply with the warning under Rule 479,” which states that if the statement is not “timely modified or withdrawn,” it will be considered abandoned.
Notably, SkyBride Capital was one of the first companies to file for a bitcoin ETF. However, the regulatory watchdog rejected it in January 2022 and the company did not apply again to introduce the ETF.
Pursuant to Section 6(a) of the Securities Act of 1933, First Trust SkyBridge btc ETF registered securities with the agency by filing a registration statement. However, nine months after the registration statement was filed, it has not yet entered into force.
Accordingly, the registration statement was ordered declared abandoned on Tuesday, March 12, by the Division of Corporate Finance on behalf of the Commission, in accordance with its regulations.
Grayscale secures second place in largest ETF outflows
Even though leading companies like Blackrock have witnessed significant inflows since the launch of bitcoin ETFs, Grayscale, on the other hand, has seen notable outflows. Balchunas revealed that over the past 15 years, Grayscale bitcoin Trust ETF (GBTC) has had the “second largest cumulative outflow” of any ETF.
So far, GBTC has witnessed a cumulative outflow of approximately $10,553 million. Meanwhile, EEM (iShares MSCI Emerging Markets ETF) currently holds the top spot in terms of capital outflows, with $12.341 billion.
This is intriguing since EEM catalyzed the creation of BlackRock's mini-me movement with IEMG, which Grayscale it is running with btc and GLD with GLDM.
Other notable companies that have seen substantial outflows include SPDR Gold Shares (GLD), SPDR S&P MidCap 400 ETF Trust (MDY), and United States Fund LP (USO), among others.
Featured image from iStock, chart from Tradingview.com
