Connect with us

Hi, what are you looking for?

The American GeniusThe American Genius

Business News

The SEC said no to Bitcoin… again

(NEWS) The SEC has denied a bid to list a a popular currency as an exchange-traded product.

stocks tokenai bitcoin amazon fundstrat

Here we go again

The Securities and Exchange Commission (SEC) has denied a bid to list a bitcoin exchange-traded product (ETP) on the New York Stock Exchange (NYSE).

bar
This is the SEC’s second denial in a month to allow trading in a bitcoin-tied ETP.

Don’t touch it with a ten foot pole

In a Tuesday filing, the SEC announced rejecting the proposal to list and trade SolidX Bitcoin Trust by Intercontinental Exchange INC’s Arca exchange.
On March 10, the SEC also snubbed the application of listing bitcoin ETP on the Bats BZX Exchange by investors Cameron and Tyler Winklevoss.

Soon after, Bats challenged the SEC decision, and an outcome is pending.

It is clear from these two decisions that the SEC is skeptical of bringing to market a first-of-its-kind product that tracks the virtual-currency.

A currency that is not a currency that is a currency

Bitcoin is a pseudo-currency that operates virtually. Anonymity is easy, as the currency has managed to bypass any central authority or regulations by national banks and governments thus far.

Advertisement. Scroll to continue reading.

This very fact, which is attractive to many its users, is what makes SEC skeptical.

“The Commission believes that the significant markets are unregulated,” said the filing. To overcome those issues, the Commission pointed out, the virtual coin products must have “surveillance-sharing agreements” with the market and “those markets must be regulated”.

This poses significant challenges

Businesses operating with bitcoins can be regulated with relative ease.

But the coin’s peer-to-peer protocol makes the flow of finance impossible to trace.

ETF providers therefore can never sign on to surveillance sharing agreements.

The value

We recently reported how Bitcoin has become more valuable than gold, trading as high as $1300 earlier this month.

However, the denial of the Winklevoss ETP led to a plunge in the currency’s price to $1,041.

This latest denial of SolidX Bitcoin Trust might erode its value more.
Notes J.P Buntinx of Bitcoin Service News, the “price has seen extended volatility over the past few weeks. Volatility is not a positive trait when it comes to launching an ETF of such magnitude”.

Advertisement. Scroll to continue reading.

More coin exchange proposals

The SEC is currently also reviewing a third Bitcoin ETP, the Bitcoin Investment Trust, proposal made by Grayscale Investments LLC.
If the first two decisions are any indication, the prospects for Grayscale are not rosy at all.

Perhaps on the blue moon

One of the crypto-currency’s biggest challenges has been the inconsistent treatment of its asset-holders in the hands of governments around the world.
[clickToTweet tweet=”Bitcoin’s limited adoption and resistance make it a risky asset for many investors.” quote=”Bitcoin’s limited adoption and resistance from central banks from America to China still makes it a risky asset for many investors.”]

One thing is for certain. Bitcoin ETPs won’t be introduced in US markets anytime soon.

#BitcoinBlues

Advertisement. Scroll to continue reading.

Barnil is a Staff Writer at The American Genius. With a Master's Degree in International Relations, Barnil is a Research Assistant at UT, Austin. When he hikes, he falls. When he swims, he sinks. When he drives, others honk. But when he writes, people read.

1 Comment

1 Comment

  1. Pingback: The rise of cryptocurrency (and what the heck it even is) - The American Genius

Leave a Reply

Your email address will not be published.

The
American Genius
news neatly in your inbox

Subscribe to our mailing list for news sent straight to your email inbox.

Advertisement

KEEP READING!

Opinion Editorials

(SOCIAL MEDIA) Musk is far from meager when it comes to business. After buying an almost 10% stake in Twitter, he declined board status,...

Business Finance

(FINANCE) The thousands of banks and millions of merchants on the Mastercard network could soon integrate cryptocurrency in their products and purchases

Business Finance

(BUSINESS FINANCE) India is potentially planning to ban cryptocurrency — and instead, they're planning to introduce their own version of it for purchase.

Business Finance

(BUSINESS FINANCE) Losing the password to your Bitcoin wallet often means potentially losing your cryptocurrency. But this didn’t stop a Russian investor from getting...

The American Genius is a strong news voice in the entrepreneur and tech world, offering meaningful, concise insight into emerging technologies, the digital economy, best practices, and a shifting business culture. We refuse to publish fluff, and our readers rely on us for inspiring action. Copyright © 2005-2022, The American Genius, LLC.