Many investors and traders have started to anticipate the next deadline of Bitcoin exchange-traded fund (ETF) filings with the US Securities and Exchange Commission (SEC). But, it is highly unlikely for the SEC to approve the first Bitcoin ETF in US markets within the next two months.

Earlier this week, publications reported that the deadline for the rule changes initiated by GraniteShares and Proshares Bitcoin ETFs, which were rejected by the SEC in August, is Oct. 26. This date is also the deadline for the public to submit statements in favor or opposition against the ETFs.

Due to the objection of SEC Commissioner Hester Peirce, the nine rejected Bitcoin ETFs were given the chance to file rule changes with the SEC to potentially overturn the commission’s decision. However, the ETFs of GraniteShares and Proshares will not be approved or declined by the end of October and the deadline of the SEC to provide a decision on the ETFs is in November.

Why No ETFs are Happening This year

Government enforcement defense and securities litigation attorney of Kobre and Kim LLC, Jake Chervinsky explained that the process of receiving the final decision by the SEC for the nine ETFs will take significantly longer than the expectations of investors in the market.

He said:

“The deadline is for the public to submit statements of support or opposition, not for the SEC to finish its review (& the deadline is Nov. 5, not Oct. 26). The SEC will then review the statements & write an order. Could be a while.”

Previously, subsequent to the SEC’s announcement to review the nine ETFs again, Chervinsky emphasized that under existing regulations, any commissioner can request the SEC to re-evaluate ETF filings.

Chervinsky said:

“Don’t get too excited, folks. Under Rule 431 of the SEC’s Rules of Practice, it only takes a single Commissioner to order a review like this. Hester Peirce deserves credit & respect for putting up a fight, but there’s no reason to think yesterday’s rejections will be reversed.

Hence, it is likely that in November, the SEC will echo its sentiment that the Bitcoin futures market is simply not mature enough to support an ETF.

Last month, the SEC rejected the ETF filings of nine institutions because they based the price of ETFs on the Bitcoin futures markets operated by CME Group and Chicago Board Options Exchange (Cboe). The SEC stated that the futures market of Bitcoin is not of sufficient size to handle large demand from investors in the traditional finance market.

In the past two months, the futures market of Bitcoin has not changed in terms of structure, volume, and infrastructure. ErisX has announced the launch of the first multi-cryptocurrency futures market with the support of $30 billion brokerage giant TD Ameritrade but it is still months away.

As such, if the ETFs still rely on the futures market as the base price of Bitcoin, then the SEC will deny the ETFs once again by the end of this year.

The official document released by the SEC released on Aug. 22 read:

“[The ETFs have not met the requirement that a national securities exchange’s rules be designed to prevent fraudulent and manipulative acts and practices. Among other things, the Exchange has offered no record evidence to demonstrate that bitcoin futures markets are ‘markets of significant size.'”

Hope is Still There, Only For 2019

VanEck and Cboe Bitcoin ETFs are said to have the highest probability of being approved by the SEC. Both institutions have decades of a track record of compliance, security, and trust in the traditional finance sector, and the two ETFs are insured, protected, and audited.

The final deadlines of the two ETFs are in early 2019 and thus, the first Bitcoin ETF is not likely to be approved by the commission until early 2019.