Bitcoin ETF Hits SEC Roadblock; Former FTX CEO SBF Jailed

Bitcoin ETF Hits SEC Roadblock; Former FTX CEO SBF Jailed

The Securities and Exchange Commission (SEC) delayed its decision regarding Cathie Wood and her ARK Invest bitcoin ETF on Friday. This further complicates efforts to incorporate cryptocurrency assets into traditional U.S. exchanges. 

In addition, Sam Bankman-Fried, the former CEO of FTX, has returned to prison on charges of witness tampering. As for the market, Bitcoin and other cryptocurrencies experienced a slight decline on Monday.

Cathie Wood Delays BTC ETF

The deadline for the SEC to decide on the ARK 21Shares Bitcoin ETF fund had passed on August 13. Friday, the regulator took a different approach, indicating that they are seeking public input on a proposed change to the application. This action may result in delaying the approval decision until 2024.

Cathie Wood suggested in an interview with Bloomberg on Monday that the SEC could choose to simultaneously approve multiple spot-bitcoin ETFs. ARK and Wood initially believed the ARK 21Shares fund would be the first to receive approval.

In recent months, companies including ARK, BlackRock (BLK), Invesco (IVZ), and WisdomTree (WT) have submitted or resubmitted applications for Bitcoin ETFs, demonstrating a growing interest in these instruments.

The SEC has decided to allow the public three weeks to comment on the proposal, followed by an additional five weeks for the public to respond to the statements.

Grayscale filed suit against the SEC in late July after its requests to convert the Grayscale Bitcoin Trust (GBTC) into a standard Bitcoin ETF were denied. Additionally, the company argued that the SEC should simultaneously approve multiple ETFs to avoid favoring certain options over others.

SBF Sentenced To Jail

In addition, Sam Bankman-Fried, the former CEO of FTX, witnessed a new development in his case on Friday. As a result of allegations of witness tampering, Judge Lewis Kaplan of the Federal District Court in Manhattan reportedly issued an order to jail Bankman-Fried. 

This decision followed the revocation of his bail. According to the New York Times, he was subsequently transported to the Metropolitan Detention Center in Brooklyn.

Prosecutors have asserted that Bankman-Fried was responsible for leaking a private diary belonging to former Alameda Research CEO Caroline Ellison to the New York Times. 

The alleged intent of this action was to intimidate witnesses and potentially influence potential jurors. Prior to this, SBF was under house arrest at his parents’ home as he awaited the start of his October trial. In December, he posted a $250 million bond.

The misuse of customer funds precipitated the collapse of the FTX cryptocurrency exchange in November, when its financial records revealed a significant deficit of $10 billion. 

December saw the arrest of Bankman-Fried on charges including wire and securities fraud. In spite of the charges, he pleaded not guilty; if convicted, he could face up to 115 years in prison.

Price Movement of Bitcoin

On Monday, cryptocurrency prices experienced a moderate decline. Monday ended with Bitcoin trading at approximately $29,320, having peaked at $29,661 during the day. Last Wednesday, it briefly surpassed the $30,000 mark, but for the past three weeks it has struggled to maintain that level. 

Currently, it is trading below its 2023 high of $31,809, which occurred on July 13. This year, the world’s largest cryptocurrency has rebounded with a 77% increase.

In the meantime, Ethereum fell below $1,854 on Monday afternoon, falling from its recent peak of $1,860. Since July 23, Ethereum’s price has been below $1,900. Notably, Ethereum peaked on April 16 at $2,139, marking its highest value since May of the previous year. 

This increase followed the April 13 upgrade to a proof-of-stake network in the Shanghai market. The value of the second-largest cryptocurrency has increased significantly by 53.6% this year.


About Ylleza Jashari

Senior student pursuing a degree in Security Studies at Rochester Institute of Technology. In my role as a Content Writer at Walletor, my primary objective is to develop informative content that effectively educates all Walletor users on the most up-to-date insights pertaining to financial transactions, digital wallets, and the broader cryptocurrency industry.