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May 1, 2019
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Bitcoin Regulation

SEC Applications Rejects for 9 Bitcoin ETFs

The SEC has said no to applications for nine different Bitcoin ETFs. Applications came from ProShares, Direxion, and GraniteShares.  

Nine applications to list and trade different Bitcoin $6448.13 -0.05% ETFs were rejected by the SEC, according to three different releases dated August 22nd.

The regulatory agency predictably rejected five proposed ETFs from Direxion, two from Proshares, and two from GraniteShares. The SEC cited concerns over fraud and manipulation as the main reasons for the rejection.

The official deadline for the ProShares choice was August 23, while GraniteShare’s putting forth was slated for September 15. Many were interested to perceive how the SEC’s choice would play out, particularly since any kind of positive news would absolutely send Bitcoin cost $6448.13 – 0.05% drifting upwards.

Many were curious to see how the SEC's decision would play out, especially since any sort of positive news would certainly send Bitcoin prices trending upwards.

A Flurry Of Rejections

In each report, the SEC listed specific reasons that led them to reject each application. But in all three releases, the agency wrote:

“[T]he Commission is disapproving this proposed rule change because, as discussed below, the Exchange 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 the Exchange Act Section 6(b)(5), in particular the requirement that a national securities exchange’s rules be designed to prevent fraudulent and manipulative acts and practices.”

The SEC additionally noticed how none of the applications persuaded them that the Bitcoin prospects advertise was of “noteworthy size.” According to the SEC, this disappointment is vital in light of the fact that the applications have,

“Failed to establish that other means to prevent fraudulent and manipulative acts and practices will be sufficient, and therefore surveillance-sharing with a regulated market of significant size related to bitcoin is necessary.”

However, the SEC did write

“Its disapproval does not rest on an evaluation of whether bitcoin, or blockchain technology more generally, has utility or value as an innovation or an investment.”

The latest round of rejections by the SEC is nothing new to cryptocurrency enthusiasts who are excited about the idea of a Bitcoin ETF.

Echoes of Previous Rejections

The most recent round of dismissals by the SEC is just the same old thing new to cryptographic money lovers who are amped up for the possibility of a Bitcoin ETF.

A year ago, the organization dismissed an ETF proposition from Cameron and Tyler Winklevoss, known as the Winklevoss Bitcoin Trust. In July, the SEC rejected an administer change proposition the two siblings submitted after the underlying dismissal.

The SEC said they denied the proposition because of worries about speculator insurance. At the time, the administrative body called attention to how Bitcoin was liable to extortion and control completed from seaward markets that were unregulated.

Presently, everyone’s eyes are set to sit tight for the SEC’s choice about the CBOE Bitcoin ETF proposition. Some legitimate specialists think the SEC will presumably hold off until 2019 on settling on a choice about their proposition.

In the meantime, CBOE has been fairly active in working with the SEC to mitigate concerns.

What do you think about the SEC’s latest rejections? Will the commission eventually approve a crypto ETF? Let us know in the comments!

Images courtesy of Bitcoinist archives, Shutterstock


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