U.S. SEC is unwilling to approve a Bitcoin ETF, Commissioner Hester Peirce has said in a dissenting statement.
Peirce’s statement followed the agency’s disapproval of yet another exchange-traded fund (ETF) proposal.
SEC rejects NYSE Arca ETF proposal
The NYSE Arca submitted a proposal seeking to list and trade shares of the United States Bitcoin and Treasury Investment Trust on June 12, 2019. The Exchange then amended its proposal to align more with SEC demands on October 4, 2019.
But on Wednesday, February 26, the U.S. securities watchdog disapproved of the proposed rule change.
The commission cited market manipulation and a lack of surveillance-sharing agreements with a “significant market,” as grounds for rejecting the proposal.
In its disapproval, the SEC concluded that NYSE Arca had failed “to demonstrate that its proposal is consistent with the requirements of Exchange Act Section 6(b) (5).” As per the agency, a national securities exchange needs to be able to prevent manipulative acts as well as “protect investors and [the] public interest.”
The latest ETF disapproval follows a similar pattern to other ETFs. These include Winklevoss Bitcoin ETF, VanEck SolidX Bitcoin ETF, Bitwise and Direxion Bitcoin ETFs. The firm behind the United States Bitcoin Treasury and Investment Trust ETF was Wilshire Phoenix.
SEC “Unwilling” To approve a bitcoin ETF
According to SEC Commissioner Hester Peirce, the latest order disapproving of a BTC exchange-traded fund adds to a long list of gratuitous disapproval orders from the U.S. securities agency.
Peirce contends that rejecting the proposed rule change isn’t the right move. She says the order means that “American investors continue to be denied “access [to] bitcoin through a product listed and traded on a national securities exchange subject to the Commission’s regulatory framework.”
She also notes that:
“This line of disapprovals leads me to conclude that this Commission is unwilling to approve the listing of any product that would provide access to the market for bitcoin…”
In her opinion, it appears “no [ETF] filing will meet the ever-shifting standards” the securities watchdog has insisted on when it comes to bitcoin ETFs. The commissioner called the agency’s approach to bitcoin ETFs “frustrating.” Shed added that this would only hamper institutionalization and innovation.
Pointing to the SEC’s “heightened standard[s]” that are only being applied to bitcoin-related products, Peirce concluded:
“Because the Commission’s order applies an inappropriate standard under Section 6(b)(5) of the Exchange Act, I respectfully dissent.”
Bitcoin (BTC) is trading at around $8,790 at press time.