Stock Groups

SEC Rejects Application for Bitcoin Spot ETF -Breaking

by Mike Robinson

[ad_1]

SEC Rejects Application For Bitcoin Spot Exchange Trade Fund

The U.S. Securities and Exchange Commission rejected VanEck’s proposal for an exchange-traded fund. This ETF would have had actual cryptocurrency and not just Bitcoin futures. Submitted in March, by the Cboe BZX Exchange, the VanEck plan sought to buy Bitcoin directly on the “spot” market and hold it in an ETF that investors could then have a stake in. An ETF that is futures-based invests in an indefinite contract to purchase or sell an asset on a specific date in the future.

The SEC approved two Bitcoin-based ETFs last month for trading, but it wouldn’t authorize any ETF that contained actual Bitcoin due to its regular concerns about possible fraud in the cryptocurrency market. Here is a portion of the 51-page SEC Report explaining why the ETF was rejected.

BZX was concluded by the Commission [VanEck] has not met its burden under the Exchange Act and the Commission’s Rules of Practice to demonstrate that its proposal is consistent with the requirements of Exchange Act Section 6(b)(5), in particular, the requirement that the rules of a national securities exchange be “designed to prevent fraudulent and manipulative acts and practices” and “to protect investors and the public interest.”
Friday’s rejection occurred only weeks after the SEC allowed two futures-based bitcoin ETFs to begin trading. ProShares Bitcoin Strategy ETF started trading Oct. 19. It was followed by Valkyrie Bitcoin Strategy ETF which was listed three days later.

Many other bitcoin ETFs are also available and are awaiting approval.

CoinMarketCap.com reported that Bitcoin fell to about $62,000 at the time of the SEC’s announcement, but is now more than $64,000.

To The Flipside

  • Whether it’s spot- or futures-based, a Bitcoin ETF is a lousy way to get into crypto.
  • Buying into an ETF adds unnecessary delays, fees, and intermediaries into a process you can easily do on a centralized exchange such as Coinbase (NASDAQ:) if you don’t know where to start.
  • Bitcoin was created to REMOVE delays, fees, and middlemen – not inject them into the crypto purchasing process.

What are the reasons to care?

Although this will probably delay widespread adoption of cryptocurrency, it is possible to still invest in the sector through many avenues.

EMAIL NEWSLETTER

Get the other side of crypto!

Upgrade your inbox and get our DailyCoin editors’ picks 1x a week delivered straight to your inbox.

[contact-form-7]
With just one click, you can unsubscribe at any time.

Continue reading on DailyCoin

Disclaimer: Fusion MediaThis website does not provide accurate and current data. CFDs are stocks, indexes or futures. The prices of Forex and CFDs are not supplied by exchanges. They are instead provided by market makers. As such, the prices might not reflect market values and could be incorrect. Fusion Media does not accept any liability for trade losses that you may incur due to the use of these data.

Fusion MediaFusion Media or any other person involved in the website will not be held responsible for any loss or damage resulting from reliance on this information, including charts, buy/sell signals, and data. Trading the financial markets is one of most risky investment options. Please make sure you are fully aware about the costs and risks involved.



[ad_2]