The US Securities and Exchange Commission (SEC) has officially disapproved of asset manager VanEck’s spot Bitcoin ETF. This happened months after the company filed its application.
SEC rejects mock Bitcoin ETF
According to a filing, the SEC rejected a proposed rule change by the Cboe BZX Exchange to list and trade shares of VanEck’s Bitcoin Trust. The SEC said:
The committee concluded that BZX has failed to fulfill its obligation under the Exchange Act. The committee also showed that the rules of practice were not being observed. It is essential that an exchange that markets a derivative has an agreement with the markets that trade the underlying asset. For example, the exchange that markets a derivative would have the necessary information. This should detect, investigate and deter fraud and market manipulation.
The rejection of the application is bad news and this is reflected in the BTC price. The price briefly dropped to a low of $62,300 today, but now seems to be slowly recovering.
Unlikely Approval
The regulatory body had a maximum of 240 days to approve or deny the application. Since the filing was filed on March 19, the SEC had until November 14 to make a decision. This after the decision had already been postponed twice. Eric Balchunas, Bloomberg’s ETF analyst, said it was highly unlikely that the SEC would approve the VanEck fund.
While the rejection is a blow to many investors, the SEC has already approved ETFs tied to Bitcoin futures contracts. In October, shares of digital asset manager Valkyrie and ProShares launched a Bitcoin futures ETF on US exchanges. Especially the BTC futures ETF from ProShares is very popular. In fact, it ranks in the top 2% of all ETFs in the stock market in terms of trading volume.