The U.S. Securities and Exchange Commission (SEC) has once again rejected an application from Ark Investment Management and 21Shares to list a spot Bitcoin exchange-traded fund (ETF) on the Cboe BZX Exchange, a decision that comes as little surprise to those familiar with the regulatory landscape surrounding the nascent crypto industry.
The idea has now been rejected by the dreaded regulator twice; the first time was in April, when a similar effort was also thwarted. Undaunted, the pair submitted a new application in May of last year, but the organization once again cited fraud and manipulation concerns as the main factors in making its decision. The SEC emphasized that BZX had not shown that their plan complied with the rules governing the avoidance of dishonest practices.
The agency’s choice is supported by its conviction that the Bitcoin market is still vulnerable to fraud and manipulation and that, to identify and discourage such behavior, a thorough surveillance-sharing agreement with a regulated market of scale is required.
According to the SEC, BZX neglected to address risk considerations unique to Bitcoin. It is unknown if Ark and 21Shares will attempt to list a spot bitcoin ETF again, but given the regulatory environment at the moment, it appears unlikely that the SEC would change its position very soon.
Image Credit: Shutterstock
Keep in mind that we may receive commissions when you click our links and make purchases. However, this does not impact our reviews and comparisons. We try our best to keep things fair and balanced, in order to help you make the best choice for you.
