The us securities and exchange Commission (SEC) again rejected the application of the brothers Cameron and Tyler Winklevoss for the creation of an exchange-traded Fund (ETF) tied to bitcoin.
The second decision was made more than a year after the SEC refused to meet the request for a change of rules sent by Bats BZX Exchange, which, if approved, would allow the release of new tools for investing in bitcoin to regulated trading platforms. Shortly after receiving the refusal, Bats filed a petition to reconsider the decision, followed by another wave of comments – and expectations – regarding the regulator's readiness to approve the exchange product for bitcoin trading.
However, the risks, which the SEC pointed out earlier, are still concerned about the regulator, as evidenced by the document published this Thursday.
The Commission emphasizes that its decision cannot be considered as an assessment of cryptocurrencies and blockchain in General and refers only to the structure of the proposal received by it.
"Although the Commission does not approve of the proposed rule change, it emphasizes that its disapproval is not based on the evaluation of bitcoin or blockchain technology in the broader sense, their value as an innovation or investment. The Commission does not approve the proposed change to the rules, as detailed below, as BZX was unable to confirm that its proposal is consistent with section 6(b)(5) of the securities trading Act, which specifically States that the rules should be drafted in such a way as to prevent acts of fraud and manipulation and related practices," the document says.
As before, the SEC does not exclude the possibility of approval of such a product in the future. "Over time, regulated markets associated with bitcoin can continue to grow and develop," the Commission writes.
"For example, existing or new bicton-futures can be significant, and the exchange involved in the listing of similar products, will be able to demonstrate in the proposed rule change its ability to resolve the risk of fraud and manipulation by an exchange of control information with the regulated market of considerable size related to bitcoin and, where appropriate, with spot markets associated with bitcoin derivatives," continues the regulator.
If this happens,"the Commission will have the opportunity to decide whether the bitcoin exchange product meets the requirements of the securities trading Law."
Sec Commissioner Hester pierce disagreed with the decision of the Department. "With all due respect, I do not support the decision of the Commission to refuse to accept the proposal to change the rules that would allow to initiate the listing and trading of securities of Winklevoss Bitcoin Trust on the Bats BZX exchange," she writes. "I am concerned that the Commission's approach could be detrimental to investor protection as it prevents the deeper institutionalization of the bitcoin market. Greater involvement of institutional investors would help to address the Commission's many concerns. The Commission's interpretation and application of statutory standards is a sure sign that innovation in our markets is not welcome, and this signal may go far beyond the fate of bitcoin-linked exchange products."
On Tuesday, it became known about the postponement of the SEC's decision regarding the bitcoin-ETF company Direxion. On request of companies VanEck and SolidX, causing the most interest at the present time, in recent publications, the regulator said nothing.