U.S. managers await SEC action on cryptocurrency funds

The advent of bitcoin futures trading in late 2017 was supposed to signal the arrival of cryptocurrency exchange-traded products in the U.S. Now, some four years later, a host of U.S. asset managers sit watching global crypto exchange-traded funds find their footing while their home market is stuck in neutral.

Over the past few weeks, the U.S. Securities and Exchange Commission has denied the critical last step for a handful of bitcoin ETPs while delaying judgment on others, including the conversion of the $21.1 billion Grayscale Bitcoin Trust into an ETF. In issuing lengthy rebuttals to proposed 19b-4 rule changes, which allow securities exchanges to list and trade shares of ETPs that fall outside of the ETF rule, the SEC has picked apart filings based on its concerns regarding market surveillance, pricing, and investor protection.

To be sure, the SEC stood by as three ETFs holding bitcoin futures came to market in the fall. Each product fit within the bounds of the ETF rule, the largest of which is the $1.1 billion ProShares Bitcoin Strategy ETF. Listed on Oct. 19, the fund has an expense ratio of 0.95% and sees average daily volume of…..

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