After several delays, the United States Securities and Exchange Commission (SEC) revealed in an announcement today that it has disapproved of a proposed rule change by Bitwise Asset Management to list a bitcoin exchange-traded-fund (ETF) on NYSE Arca.
The SEC said in its disapproval order that the proposal did not meet the legal requirements to prevent market manipulation and other illicit activities.
Notably, though, the SEC did not blame Bitwise, but NYSE Arca by saying that the trading venue NYSE Arca
has not met its burden under the requirement that the rules of a national securities exchange be
“designed to prevent fraudulent and manipulative acts and practices.”
The SEC precisely stated:
The Commission is disapproving this proposed rule change because, as discussed below, NYSE Arca has not met its burden under the Exchange Act and the Commission’s Rules of Practice to demonstrate that its proposal is 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.
End of the Road?
The latest SEC rejection of a Bitcoin ETF practically rules out any possibility of the regulator giving the green light to such a proposal this year.
However, with SEC Chairman, Jay Clayton saying in a recent interview that they’re making progress towards the approval of a Bitcoin ETF, it appears safe to say that the regulator is open to welcoming such an offering but not as soon as some industry participants wanted.
Interesting, Bitwise’s CEO Hunter Horsley, as Coinfomania reported, had suggested that they’ll keep knocking on the SEC’s door despite the outcome of today’s decision.