It is quite difficult to build a proposal with such carefulness that it passes or, better yet, owns the approval of the Securities and Exchange Commission. At the time of writing, there are multiple Bitcoin futures ETFs that have been now approved by the SEC, but there was a time when the Commission would just not accept any of these. After the successful approval and trading of various Bitcoin futures ETFs, financial enterprises and people are getting more excited and innovative with their own ETF proposals. Recently a spot Bitcoin ETF proposal was submitted to SEC, which would track the price of Bitcoin, but sadly it has been turned down.
The proposal came from an investment firm by the name of VanEck, and the reason for denying the proposal was the possible intention of manipulating crypto markets. There are these basic criteria that Commission has set for every proposal that it receives, it should be thorough, and it should be on the solid grounds of preventing market manipulation and fraudulent activities from catching up to the investors.
Bitcoin Spot ETF Failed to Get Approval from SEC
According to the Commission, the firm did not provide enough proof that it could take care of the investors in these specific regards. It is important for the Commission to accept those proposals that have legitimate offerings and a strong will to protect their investors from fraud or the manipulation of financial markets. These firms must have the technological means and professional capacity to collect real-time data of the markets and run multiple analyses to be able to get the ultimate surety that it will not affect the investors in any fraudulent sense.
The rejection was handed out to the firm only after three weeks of the approval for the first two Bitcoin futures ETFs. These exchange-traded funds helped Bitcoin to secure a massive bullish rally which triggered the price of the cryptocurrency all the way to $69K. This is yet the ultimate all-time high for Bitcoin. First rejection doesn’t mean that the firm is now banned from trying again; it should improve its case and try its luck once again with the SEC when they are ready.
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