By Hannah Lang and Katanga Johnson

(Reuters) – Two proposals by the U.S. Securities and Exchange Commission to provide bitcoin exchange-traded money were rejected. Market participants had hoped for a favorable outcome after the October approval of futures-backed Bitcoin funds.

The markets regulator stated that both the Valkyrie Fund proposal and Kryptoin Bitcoin ETF Trust proposals for trading shares in Valkyrie Fund were rejected because they didn’t meet the standard.

“(These proposals) do not meet the standard of being designed to prevent fraudulent and manipulative acts and practices and to protect investors and the public interest,” the SEC said.

In October, two bitcoin-based futures funds were approved by the SEC, the ProShares Bitcoin Strategy ETF (Valkyrie Bitcoin Strategy ETF) and which both made their Wall Street debuts in the same month.

The regulator is yet to approve a request for a spot Bitcoin ETF. The SEC denied VanEck’s application for a spot Bitcoin fund, while delaying a Dec. 17 decision from Grayscale Bitcoin Trust.

ETFs, which track stocks across a range of sectors and offer lower fees than other investment options, are becoming more popular. ETFs that track Bitcoin are designed to give you exposure to this digital currency. They also help to avoid the headache of managing private keys and buying cryptocurrency on an exchange.

The approval of the SEC for such products has been sought by stock exchanges as well as industry groups.

They expressed concern about Gary Gensler (Democratic SEC Chair) and the investor advocates. This is because they feel there’s a lack in regulatory supervision and oversight, which increases the risk of fraud and manipulation.