The U.S. Securities and Trade Fee (SEC) has rejected the Knowledge Tree Bitcoin Belief ETF, because it has no legitimate measure to guard traders towards market manipulation.
The SEC in an Oct. 11 launch famous that it needed to reject the submitting by BZX Trade, because the bitcoin-ETF issuer doesn’t have a major surveillance sharing settlement with a regulated marketplace for bitcoin.
A surveillance-sharing settlement permits market contributors to simply share market buying and selling and clearing activist and buyer id within the occasion of any worth manipulation of BTC.
In accordance with the SEC, the surveillance settlement is essential earlier than it might approve any spot bitcoin-ETF, on condition that the marketplace for bitcoin is very unregulated.
The primary Knowledge Tree spot bitcoin ETF was additionally rejected in December 2021 on grounds of investor safety.
SEC and spot bitcoin ETF rejections
The SEC’s choice to reject the Knowledge Tree ETF utility isn’t any shock to many, because the US regulator has a long-standing historical past towards bitcoin spot ETFs.
The Winklevoss twins have been the primary to ever try to file a Bitcoin ETF in July 2013. Nevertheless, the SEC rejected their utility in March 2017.
The VanEck Solidx ETF adopted go well with in July 2013, but it surely confronted rejection in January 2019.
In 2017, ProShares, Direxion, and GraniteShares tried to have their respective functions authorised, however the SEC hit the rejection dial.
Bitwise, Wilshire, and Actuality Shares ETF all had a rejection of functions they made in 2019.
By mid-2020, Knowledge Tree submitted its first utility, which the SEC rejected a couple of yr later.
VanEck refiled its utility in January 2021, whereas Constancy, NYDIG, and GrayScale all filed for bitcoin ETFs in the identical interval. VanEck’s utility was rejected once more in Nov. 2021.
Thus far in 2022, the SEC has rejected functions by GrayScale, BitWise, and the most recent Knowledge Tree.
The rising listing of rejected spot bitcoin ETF functions has been influenced by SEC Chair Gary Gensler. Gensler has expressed his desire for futures ETFs stating that spot ETFs are extra liable to fraud and manipulation.
