The US Securities and Exchange Commission has once again rejected the proposal quotare l’ARK 21 Shares Bitcoin ETF sul Cboe BZX Exchange. A similar proposal had already been rejected in April last year.
“The SEC just rejected yet again the listing of ARK and 21Shares’ spot Bitcoin-based ETF.”
The SEC has just now once again rejected ARK’s and 21Shares spot bitcoin, $BTC ETF listing.
— unusual_whales (@unusual_whales) January 26, 2023
The proposed ETF would be jointly managed by Ark Investment Management and 21Shares. The purpose of the fund was to allow investors to gain exposure to the price of Bitcoin, within the confines of the regulated stock market.
The Cboe BZX Exchange had initially applied to list the ETF in June 2021, but the application was rejected in 2022. It filed a new application in May, making further legal arguments in favor of the fund.
In the second question, the Cboe BZX Equities Exchange said it tightened “a global surveillance sharing agreement with a significant regulated market” – that it was later discovered to be the Chicago Mercantile Exchange (CME)where BTC futures contracts are currently being traded – in order to prevent illicit price manipulation.
The Cboe also points out that most spot markets for currencies and commodities are unregulated, but this is usually not enough reason to reject applications for ETFs.
Also Read: Grayscale CEO: SEC’s “one-sided” approach slows Bitcoin’s progress
Ma the SEC rejected those arguments. He said the surveillance sharing agreement between the Cboe BZX Equities Exchange and the Chicago Mercantile Exchange does not apply to the spot Bitcoin market, as the CME only trades the BTC-based futures contracts.
The SEC also said it’s not always necessary to have a surveillance sharing agreement in place; but if there is no such arrangement, then it must be the exchange itself at “provide sufficient means to prevent fraudulent and manipulative acts.Since the company cannot prove this point, the SEC cannot allow an ETF to be listed.
To date, the US SEC has not approved any Bitcoin ETFs. Grayscale Investment Trust is looking to convert its Bitcoin Trust into a Spot Bitcoin ETF, and is suing the SEC for rejecting its proposal
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