23.07.2025 01:42

The U.S. Securities and Exchange Commission (SEC) abruptly halted the approval process for Bitwise Asset Management's crypto index fund, despite initially progressing through the necessary stages. This unexpected turn of events followed an earlier approval of proposed changes submitted by Bitwise.

On July 22nd, the SEC's Division of Trading and Markets had advanced Bitwise's Bitwise 10 Crypto Index ETF application through the approval pipeline. However, Assistant Secretary Sherry R. Haywood intervened, citing Rule 431 of the Commission's Rules of Practice (17 CFR 201.431). This rule allows the SEC to reconsider its decisions, effectively placing the approval process on hold.

Haywood's letter explicitly stated that the July 22nd order was suspended pending further review by the SEC. The Bitwise 10 Crypto Index Fund, trading under the ticker "BITW," holds significant stakes in various prominent cryptocurrencies, including Bitcoin, Ethereum, XRP, Solana, and Polkadot, with asset allocation based on market capitalization.

This SEC decision isn't an isolated incident. Earlier this month, a similar situation unfolded regarding the Grayscale Digital Large Cap Fund LLC, another fund with substantial cryptocurrency holdings. This fund, accessible only to qualified investors, boasts a portfolio heavily weighted toward Bitcoin (approximately 80%) and Ethereum (around 11%), with smaller allocations to SOL, ADA, and XRP. In this case, however, the SEC acceded to Grayscale's request for a conversion – a stark contrast to the Bitwise situation. The reasons behind the differing treatment of these two similar funds remain unclear, prompting speculation and analysis from market observers and experts within the crypto industry.