SEC, has disapproved VanEck’s spot Bitcoin exchange-traded fund, months after the asset manager submitted its application
SEC Denied A Proposed Rule of Change
The SEC denied a proposed rule change from the Cboe BZX Exchange to list and trade shares of VanEck’s Bitcoin (BTC) Trust, according to a Nov. 12 filing. The SEC stated that any rule change in support of the ETF approval would not be “intended to deter fraudulent and deceptive activities and practices,” nor would it “protect investors and the public interest.”
“The Commission concludes that BZX has failed to meet its burden under the Exchange Act and the Commission’s Rules of Practice to demonstrate that its proposal is compatible with Exchange Act Section,” the SEC said, adding:
“It is essential for an exchange listing a derivative securities product to enter into a surveillance-sharing agreement with markets trading the underlying assets for the listing exchange to have the ability to obtain information necessary to detect, investigate, and deter fraud and market manipulation, as well as violations of exchange rules and applicable federal securities laws and rules.”
Following its publication in the Federal Register on March 19, the regulatory body had a maximum of 240 days to approve or disapprove the offering, giving the SEC until Nov. 14 to make a decision after extensions on April 28 and Sept. 8.
Is This SEC First Dismissal?
Given the SEC’s past record of dismissing offerings from financial firms with exposure to crypto, industry analysts such as Bloomberg senior ETF analyst Eric Balchunas put the odds of the VanEck fund being approved at less than 1%, a prediction that came true.
“[The SEC] addresses the paradox of not recognizing CME as a regulated market of substantial size in spot denial but accepting futures ETFs,” Balchunas added. “It’s a great point, but the SEC doesn’t seem to care.” It’s not going to happen. Technical legality, in essence, triumphs over logic and reason.”
The influence on Bitcoin’s price caused it to drop below $62,300 in the last hour before recovering to $62,976.
