Australian Bitcoin ETF delayed due to an unidentified broker

NEW DELHI (CoinChapter.com) — The Australian Stock Exchange (CBOE) announced a delay in the launch of Australia’s first Bitcoin (BTC) ETF. The CBOE released a statement stating “Standard checks prior to the commencement of trading are still being completed.”

Trading for the Cosmos Asset Management and ETF Securities Funds was scheduled to begin on Apr 27, at 10:00 am local time. However, according to an AFR report, reported that a powerful but undisclosed third-party broker is the one blocking the launch.

As per the report, the “prime” or “executing” broker is yet to appoint a market maker for the product’s launch.

In detail, an ETF is an investment vehicle that tracks the prices of either an asset or a group of assets. It helps investors invest in multiple assets without actually holding the assets. Regulators in the U.S. have been lenient regarding a Bitcoin Futures ETF, but a spot BTC ETF has been sort of a taboo.

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However, regulators in other countries have started accepting Bitcoin Spot ETFs as well. To recap, a Bitcoin Spot ETF follows the spot (or current) prices of the underlying asset. On the other hand, a majority of Bitcoin Futures ETFs hold Bitcoin futures contracts.

The CBOE assured of an update in the coming days.

Grayscale Renews Efforts For SEC Approval

In other news, Grayscale renewed efforts to secure approval from the U.S. Securities and Exchange Commission to convert its Grayscale Bitcoin Trust into an exchange-traded fund.

In a letter to the SEC, that the Financial Times accessed, Grayscale’s legal counsel Davis Polk & Wardwell argued that the regulator’s recent approval of the “Teucrium Bitcoin Futures Fund” provides a basis for the regulator to approve Grayscale’s Bitcoin Spot ETF.

We believe the Teucrium order confirms the fundamental point … [that] when it comes to approving [ETF], there is no basis for treating spot bitcoin products differently from bitcoin futures products.”

The letter to the SEC stated

The U.S. regulator has yet to approve a spot ETF as it is concerned about market manipulation among exchanges. As such, approval of the Teucrium product is surprising since the regulator approved it under the Securities Exchange Act of 1934 instead of the Investment Act of 1940.

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Interestingly, the 1934 Act is the same framework under which Grayscale plans to launch its ETF. Moreover, Grayscale argues the SEC’s action would be arbitrary and inconsistent if it approved a futures-based ETF under the 1934 act and not a spot-one.

The firm’s CEO Michael Sonnenshein has said that legal action against the SEC is also on the table to launch its spot Bitcoin ETF.