The U.S. Securities and Exchange Commission is adding another 21 days to take public comment on changing a rule that would allow Van Eck Associates Corp. to create the first bitcoin ETF on the Chicago Board Options Exchange.

Under the order filed on Wednesday, regulators will accept input until July 7 on whether to allow the VanEck Bitcoin Trust to launch and track an index aiming to follow the cryptocurrency’s price in U.S. dollars.

In question is whether bitcoin in general is transparent enough to avoid market manipulation.

The regulatory answer to that question could have deep ramifications for bitcoin, as well as other forms of cryptocurrency, which have yet to get approval for use within exchange-traded products.

Another key question the SEC posed is whether bitcoin’s liquidity in the spot markets is enough to make it resistant to the price-swing effects of large market orders.

Within the past 12 months alone, bitcoin rose from $9,457 as of June 16, 2021 to $63,346 this April due to speculators driving up prices. But in May, Tesla Inc. CEO Elon Musk announced the company would stop accepting the currency as payment for its vehicles because the process of mining it is energy-intensive. That announcement played a major part in sending the currency tumbling 41% between May 8 and May 23.

VanEck was the first to file for a bitcoin ETF, on December 30 last year, and has since been joined by at least seven other firms seeking to launch competing funds.

"VanEck continues to believe investors will be well-served by having a publicly registered bitcoin product, and we’re committed to working with regulators during their period of consideration," the firm said in an email to ETF.com.

Contact Dan Mika at dmika@etf.com, or follow him on Twitter

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