Proposals by Valkyrie and Kryptoin didn’t convene the SEC’s investor safety standards.
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The SEC scorned proposals for spot bitcoin ETFs from Valkyrie and Kryptoin on Wednesday. The applications failed since they are didn’t fill standards for protecting investors against fraud and manipulation. Busines players expressed confidence recognize bitcoin ETFs weren’t far off, after the SEC approved futures-based ETFs in October. Sign up now for our daily newsletter, 10 Things Before the Opening Bell.
The Securities and Exchange Commission repudiated applications for Valkyrie and Kryptoin spot bitcoin ETFs on Wednesday, the latest blow to those hoping to finally get the financial commodities agreed upon by the US.
The protections regulator has yet to give the go-ahead for a US exchange-traded fund that invests instantly in the cryptocurrency, pointing to concerns about fraud and manipulation.
In notifications to NYSE Arca and Cboe BZX Exchange, the SEC refused their proposals to list and trade the blot bitcoin produces from Valkyrie and Kryptoin. It said these failed to meet its investor protection requirements.
Neither proposal meets its standard “designed to prevent fraudulent and devious behaves and practices” and “to protect investors and the best interest, ” the SEC said in the rejection orders published Wednesday.
The decision comes five weeks after the agency shot down a Cboe BZX Exchange application for a VanEck spot bitcoin ETF in November.
Bloomberg Intelligence analyst Eric Balchunas described the latest move as a “Scrooge-jection, ” and said it’s unlikely a place bitcoin ETF will get the green light in the US next year, either.
“The fact that the SEC is disapproving faster than she was required to — well optimistic about futures, but we’re not self-confident in a 2022 approving, ” Balchunas said, distributed according to a Bloomberg report.
Gary Gensler, the chairperson of the SEC, has indicated the agency is in favor of ETFs related to bitcoin futures, but not those based on the cryptocurrency itself. It has accepted or delayed applications, even as American investors can access place bitcoin ETFs listed in Canada.
In previous rejection orders, the regulator has signalled its concerns about premium manipulation in bitcoin blot sells and the lack of sound custody options.
Market participates were considered that the SEC’s approval in October of bitcoin futures ETFs was a sign of thawing in its posture. But on December 17, it delayed decisions on applications for spot bitcoin ETF applications from Grayscale and Bitwise.
The SEC is due to make a ruling on Anthony Scaramucci’s Skybridge Bitcoin ETF before January 22, and on Fidelity’s Wise Origin Bitcoin Trust application by January 27.
ProShares debuted the first-ever futures-based bitcoin ETF in the US in late October. It became the fastest ETF to top$ 1 billion in resources under management, hitting that elevation after exactly two days of trading.
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