23.07.2025 06:47
The U.S. Securities and Exchange Commission (SEC) unexpectedly halted the approval of Bitwise Asset Management's application to convert its Bitwise 10 Crypto Index Fund into a spot exchange-traded fund (ETF), just hours after initially granting it. This surprising reversal, following a similar delay for Grayscale's Bitcoin Trust earlier in July, has plunged the fund into regulatory uncertainty and raised concerns about the SEC's approach to cryptocurrency investments.
Initially, on July 22nd, the SEC's Division of Trading and Markets swiftly approved Bitwise's proposal. This approval, based on amended Rule 8.500‑E governing Trust Units, would have allowed the fund to list and trade on the NYSE Arca, marking a significant step towards wider adoption of multi-asset crypto ETFs in the United States. The move was widely considered a major milestone for the cryptocurrency industry.
However, this celebratory atmosphere was short-lived. Later that same day, the SEC's Office of the Secretary issued a notice initiating a full Commission review of the delegated approval. This action, mandated under Rule 431 of the Commission's Rules of Practice, automatically suspended the approval, placing the Bitwise fund in limbo pending the full Commission's decision. The SEC has yet to provide a clear explanation for this sudden about-face, leaving investors and the crypto community speculating about the reasons behind the delay.
The Bitwise 10 Crypto Index Fund, launched in 2017 and trading under the ticker BITW, is designed to mirror the performance of the top ten cryptocurrencies by market capitalization, excluding stablecoins and wrapped tokens. As of June 2025, Bitcoin and Ethereum constituted a significant portion of its holdings, accounting for almost 90% of the fund's portfolio. Other prominent assets within the fund include XRP, Solana, Cardano, Chainlink, Avalanche, Litecoin, and Polkadot. The conversion to an ETF was intended to provide greater accessibility for a broader range of investors and potentially lower fees. The SEC's actions now cast doubt on the timing and ultimate success of this initiative.
The SEC's decision to halt the approval, following a similar delay affecting Grayscale's GDLC, has fueled speculation about the regulatory landscape for crypto assets in the U.S. and highlighted the inherent uncertainty within the industry. The reasons behind this decision remain unclear, leaving investors and market participants anxiously awaiting further clarification from the SEC. The outcome will significantly impact the future trajectory of cryptocurrency ETFs and investor confidence in the market.
