• Wed. May 25th, 2022

SEC Rejects Bitcoin ETF Spot Requests From NYDIG and Global X

ByHazel R. Lang

Mar 11, 2022

The U.S. Securities and Exchange Commission, or SEC, has disapproved applications for Bitcoin cash exchange-traded funds from New York Digital Investment Group and fund manager Global X after repeatedly postponing a decision over the course of the year. last year.

According to two documents filed Thursday, the SEC has rejected rule changes proposed by the Cboe BZX Exchange and the New York Stock Exchange’s Arca to list and trade shares of the Global X Bitcoin Trust and the New York Bitcoin Exchange Traded Fund. York Digital Investment Group, or ETF, respectively. The SEC said NYSE Arca and Cboe BZX had failed to discharge the burden imposed by the Exchange Act and that SEC rules of practice stated that the ETF would be “designed to prevent fraudulent acts and practices and manipulators” and “to protect investors and the public interest”. ”

The New York Digital Investment Group, or NYDIG, and Global X filed applications with the SEC for the spot Bitcoin (BTC) ETF in June and August 2021, respectively, but the commission designated longer periods to approve or disapproved of the proposed rule change and opened requests for public comment several times before making a decision on Thursday. The rejections followed similar decisions for BTC ETF spot applications from WisdomTree and VanEck.

Although the US regulator has yet to approve applications for spot Bitcoin ETFs from financial institutions, investment vehicles linked to Bitcoin futures have had more success. Many companies filed applications for BTC “strategy” ETFs after SEC Chairman Gary Gensler said in August 2021 that he would be more open to accepting contract-based exchange-traded funds crypto futures rather than through direct exposure. The commission has since approved ETFs linked to BTC futures from Valkyrie, ProShares and VanEck.

Related: SEC Chairman not yet hinting at no spot Bitcoin ETF, but cites ‘careful consideration’ for the future

As other companies’ crypto ETF applications are still in the works, at least one company is taking more initiative to seemingly pressure regulators. After the SEC delayed its decision on whether to approve Grayscale converting its Bitcoin Trust into a spot BTC ETF, the asset manager launched a campaign calling on US investors to submit comments to the SEC. The regulator is expected to make a decision on the ETF by July 6.

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