In gloomy news for a cryptocurrency market that was showing new signs of vitality, the US Securities and Exchange Commission (SEC) has rejected Tyler and Cameron Winklevoss’ proposed Bitcoin ETF for a second time.
The news comes shortly after the SEC elected to delay its verdict on several other proposed Bitcoin ETFs until September this year, and further turned down a proposed rule change from Bats BZX Exchange.
As a result, Bitcoin has retreated below the $8,000 USD mark to trade at $7,900 USD at press time – a damning reversal given the gains the pre-eminent cryptocurrency made earlier this week.
The Winklevoss brothers first proposed a Bitcoin ETF earlier in 2017, where their initial proposal was turned down on March 10th.
While the news does not create a damning indictment on other proposed Bitcoin ETFs, it remains to be seen as to whether another proposal might shift the SEC’s continued stance.
The SEC has previously elaborated that it may one day approve a Bitcoin ETF – noting that “over time, regulated bitcoin-related markets may continue to grow and develop.”
Principally, proposed Bitcoin ETFs have endeavored to track Bitcoin prices offered through Bitcoin Futures contracts – and the SEC has argued that both low Futures volumes and liquidity do not constitute a worthwhile price index.
The Commission made a hopeful submission, however, indicating that “existing or newly created bitcoin futures markets may achieve significant size, and an ETP listing exchange may be able to demonstrate in a proposed rule change that it will be able to address the risk of fraud and manipulation by sharing surveillance information with a regulated market of significant size related to bitcoin, as well as, where appropriate, with the spot markets underlying relevant bitcoin derivatives”.
At press time, Bitcoin is down by -3.77% day-on-day, and presently trades at $7,913.80 USD.