The U.S. Securities and Exchange Commission (SEC) has rejected the latest attempt at creating a bitcoin exchange-traded fund (ETF).
The SEC announced Wednesday that the ETF proposal, filed by Bitwise Asset Management in conjunction with NYSE Arca, did not meet legal requirements to prevent market manipulation or other illicit activities. The SEC placed the burden on NYSE Arca, rather than Bitwise's proposal itself.
To date, the SEC has rejected all bitcoin ETF proposals, citing market manipulation and fraudulent activity concerns.
The order read:
Bitwise first filed the ETF proposal with NYSE Arca in January 2019, kicking off its most recent push to offer retail customers a regulated bitcoin product. The company sought to be the first firm to launch an ETF in the U.S., alongside competitor VanEck, which filed a similar proposal in January with SolidX and Cboe BZX.
VanEck pulled its version last month.
Bitwise tried to reassure the regulator that issues relating to market manipulation and fraudulent activity could be addressed, publishing a number of reports on what it saw as the “real” bitcoin market and showing that market activity correlated tightly with the regulated bitcoin futures markets.
With Wednesday's rejection, the SEC only has one bitcoin ETF proposal currently sitting before it, filed by Wilshire Phoenix and NYSE Arca.
Bitwise Global Head of Research Matthew Hougan image via CoinDesk archives
The leader in news and information on cryptocurrency, digital assets and the future of money, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups. As part of their compensation, certain CoinDesk employees, including editorial employees, may receive exposure to DCG equity in the form of stock appreciation rights, which vest over a multi-year period. CoinDesk journalists are not allowed to purchase stock outright in DCG.
Learn more about Consensus 2023, CoinDesk’s longest-running and most influential event that brings together all sides of crypto, blockchain and Web3. Head to consensus.coindesk.com to register and buy your pass now.