According to a report citing “people familiar with the matter,” the U.S. Securities and Exchange Commission has allegedly informed Nasdaq and Cboe that Blackrock’s registration for a bitcoin exchange-traded fund (ETF) and the multitude of other spot bitcoin ETF applications currently in progress are considered inadequate.
SEC Reportedly Finds Flaw in the Latest Slew of Spot Bitcoin ETF Applications
Following Blackrock’s submission of an application for a spot bitcoin ETF to the U.S. Securities and Exchange Commission (SEC), numerous companies swiftly followed suit and filed their own registrations for similar products. Despite the SEC’s approval of bitcoin futures ETFs, including a newly authorized leveraged option, the regulatory body has thus far refrained from granting approval to spot bitcoin ETFs.
According to insiders cited by Vicky Ge Huang of the Wall Street Journal (WSJ), the latest registrations submitted including Blackrock’s ETF are reported to fall short of meeting the SEC’s rigorous standards.
The SEC has reportedly revealed that the submitted applications for the ETFs are deemed inadequate, the WSJ report discloses. Allegedly, the SEC has communicated this to both Nasdaq and Cboe, the two firms responsible for filing the ETF registrations on behalf of Fidelity and Blackrock.
While a spokeswoman from Cboe informed the WSJ that they intend to revise and resubmit the registration to meet the SEC’s requirements, Nasdaq declined to comment, as disclosed by the reporter on Friday. As per the sources cited in Ge Huang’s report, “the filings aren’t sufficiently clear and comprehensive.”
An array of firms, including Blackrock, Bitwise, Valkyrie, Invesco, Fidelity, Ark Investment, and Wisdomtree, have already submitted their filings, signaling the growing interest in spot bitcoin ETFs.
Additionally, Grayscale Investments, the largest manager of digital currency assets worldwide, has been striving to transform the Grayscale Bitcoin Trust into a spot bitcoin ETF. However, the Securities and Exchange Commission (SEC) rejected Grayscale’s application, prompting the firm to take legal action against the regulatory body.
The SEC’s decision-making process sheds light on their concerns regarding market manipulation. When the SEC denied the Fidelity Wise Origin Bitcoin Trust last year, they cited the inability to “prevent fraudulent and manipulative acts” or “protect investors” as the primary reasons for the denial.
What are your thoughts on the SEC’s stance towards spot Bitcoin ETFs and their concerns about market manipulation? Share your thoughts and opinions about this subject in the comments section below.