The US Securities Exchange Commission (SEC) may have once again shown that it is still struggling to grasp what cryptocurrencies really are. When the Bitcoin Exchange-Traded Note (ETN) was made available to the US populace last month, the SEC declined to comment.
Now, according to Reuters, the regulator has halted the trading of two crypto products – including Bitcoin Tracker One – that are on the Nasdaq exchange. The reason,
“Application materials submitted to enable the offer and sale of these financial products in the United States, as well as certain trading websites, characterize them as ‘Exchange Traded Funds,” read the official notice.
For what is becoming a countless number of times, the SEC has moved to stopped ETFs tracking bitcoin or any other cryptocurrency. This time, it is Bitcoin Tracker One and Ether Tracker One that has officially been stopped in the US until at least September 20.
As explained in the report, both crypto trackers are listed on a Nasdaq Inc (NDAQ.O) exchange in Stockholm, and trade “over the counter” in transactions that occur off exchanges within the United States.
Rather than risk the existence of a cryptocurrency ETF, the SEC has simply called for a stop of the investment fund while it gathers more information.
Cryptocurrency ETNs Are Harmless
XBT Provider became the first official Bitcoin Tracker when it went live on Sweden’s Nasdaq Exchange in May 2015. This offering has flourished since then, making it easier for individuals to invest in Bitcoin. Ether Tracker One (for ETH) subsequently made it debut in October 2017 while XBT also released Bitcoin and Ether Tracker Euro options.
Allowing these offerings to exist freely in the US will no doubt spike interest in bitcoin and co., thus bring in more investors into the industry.
The SEC statement announcing the temporary ban cites “confusion amongst market participants regarding these instruments” as a reason. This may be true to an extent but it has also made it clear that the regulator will simply do all it can to stop any crypto ETF from trading on regulated exchanges.
Interestingly, two decisions regarding investment channels that make it easy to trade bitcoin will be made before the end of this month. First, before September 20, the regulators will have decided whether it will discontinue trading of Bitcoin and Ether Tracker One.
It will also announce its final decision on a Bitcoin ETF request by the CBOE Markets on September 30.
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