A Bitcoin ETF’s road to SEC approval may be harder than many anticipated. After rejecting the Winklevoss’ ETF proposals twice and delaying decisions, the Securities and Exchange Commission (SEC) rejected nine ETF proposals on Wednesday, Aug 22. Among them were applications by ProShares, Granite Shares, and Direxion. The regulator released three decisions detailing the reasons why it didn’t accept these proposals.

Cboe is Ticking All The Boxes

Perhaps the more unique application for a Bitcoin exchange-traded fund (ETF) was from ProShares, which intended to base itself on either Cboe or CME Bitcoin futures contracts. The fund wasn’t planning to hold any Bitcoin but planned to act as a derivative of Bitcoin futures. Now that its proposal is rejected, investors are eagerly awaiting a decision to the Cboe ETF proposal, the fate of which could be sealed in September this year.

Cboe is already running Bitcoin futures contracts, launched earlier this year. It is one of the strongest contenders in the space. While most members of the crypto community were expecting a disappointing result from the SEC yesterday, there is far more optimism towards the outcome of the Cboe ETF.

One Twitter user, in particular, pointed out the hope for Cboe. The user Crypto Quantamental wrote:

“The best news is that the SEC denied a lot of Bitcoin ETFs (that were going to get denied) at once. They did NOT have to deny Direxion until mid-Sept. Yet they did not deny the Van Eck ETF. If surveillance/manipulation was a total deal breaker, they could have denied Van Eck now.”

The user stressed that Cboe has a valid shot at gaining the SEC’s approval. In part because the SEC did not reject them in yesterday’s batch of rejections, but also because the Cboe ETF has argued that they can resist manipulation, something that the other ETFs seemed to ignore in their proposals.

Do I totally buy their argument? Not totally. However it is infinitely stronger than Wink and much stronger than ProShares/Direxion. It is certainly strong enough to get real consideration for approval whereas the other ETFs had no shot. /End — Crypto Quantamental (@CryptoQF) August 22, 2018

Institutional Focus

Another important point to note about the Cboe proposal is that each share in the ETF consists of 25 BTC. At the price of $8,000 per coin, each share will cost $200,000. This effectively makes the product off-limits to retail investors.

The cryptocurrency community is cautiously optimistic about the outcome of the Cboe ETF. They have done far more to meet the stringent demands of the SEC, and if anyone has a shot at approval, its Cboe.