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The Securities and Exchange Commission has extended its review period of NYSE Arca’s proposal to list shares of the Bitwise 10 Crypto Index Fund (BITW) as an exchange-traded product, according to a Tuesday filing.
The decision sets a key March 3 deadline for the regulator to approve or reject the conversion of the $1.4 billion fund, making it a critical test of whether multi-crypto investment vehicles can successfully transition to exchange-traded securities.
The proposal, initially presented on November 14aims to convert the BITW quote from its current non-receipt trading status to a fully regulated ETP structure, according to the original filing.
Read more: Bitwise seeks to convert $1.3 billion crypto index into ETP
The SEC said it needed “additional time to consider the proposed rule change and the issues it raises,” but did not indicate in the filing why more time would be needed.
NYSE Arca proposed to list BITW under a new Rule 8.800-E category designed specifically for “Investment Interests Based on Commodities and/or Digital Assets,” the filing notes.
The fund currently holds 10 cryptocurrencies, with bitcoin comprising 72.7% of the portfolio, followed by Ethereum at 14.7% and XRP at 5.8%, according to the fund’s page.
If approved, the conversion would move BITW from its current OTCQX Best Market listing to exchange-traded status, which could help resolve the fund’s premium/discount issues through creation/redemption mechanisms, according to Bitwise. initial announcement.
Over-the-counter trading often presents challenges for investors, who often encounter reduced liquidity and a greater likelihood of fraud or stock manipulation compared to exchange-traded products.
The fund is currently trading at $60.95, although it has a net asset value of $71.72, highlighting the price gaps that an ETP structure aims to minimize, according to the fund’s page.
The SEC did not receive any public comments on the proposal during the initial review period, according to the filing.
The commission’s extended review of BITW’s conversion proposal aligns with its standard 45-day extension period, which is commonly used when reviewing new financial products. The March deadline gives regulators more time to assess how a multi-crypto index product would work within an exchange-traded structure.
Bitwise declined to comment on the pending regulatory filing.
