The U.S. Securities and Exchange Commission (SEC) is denying applications to establish two Bitcoin (BTC) exchange-traded funds (ETFs) based on the spot market.
According to documents from the SEC, the regulator is rejecting NYSE Arca’s bid to change a rule to list and trade shares of the NYDIG Bitcoin ETF.
The decision comes months after the SEC designated an extended period to approve or disapprove the proposed rule change.
In a separate filing, the regulator also denies Cboe BZX Exchange’s proposal to change a rule so they could do the same to the Global X Bitcoin Trust.
In both cases, the SEC says that neither NYSE nor BZX meets the minimum legal requirements needed to properly operate a securities exchange platform within the United States.
“The Commission concludes that [NYSE Arca and BZX] have not met [their] burden under the Exchange Act and the Commission’s Rules of Practice to demonstrate that [their] proposals [are] consistent with the requirements of Exchange Act Section 6(b)(5), and 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.’”
The SEC has rejected a number of bids for BTC ETFs, including from US-based ETF provider VanEck and financial services giant Fidelity.
A spot Bitcoin ETF would track the performance of a particular fund’s underlying BTC holdings.
Though the Commission has yet to approve a spot-based Bitcoin ETF, Chairman Gary Gensler has signaled that the agency will be more friendly towards futures-based Bitcoin ETFs.
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Featured Image: Shutterstock/Aleksandr Kukharskiy/Chuenmanuse
