SEC again rejects Winklevoss twins’ bitcoin ETF

Jul 27th, 2018 | By | Category: Alternatives / Multi-Asset

The US Securities and Exchange Commission (SEC) has again rejected the Winklevoss twins’ application to list a bitcoin-backed ETF, citing ongoing concerns over market manipulation.

SEC rejects Winkelvoss twins’ bitcoin ETF

The SEC’s ruling is the second time in 18 months that the Winkelvoss twins’ ambition of launching a bitcoin-backed ETF has been thwarted.

Cameron and Tyler Winklevoss, who found fame suing Facebook founder Mark Zuckerburg, have been attempting to launch the Winklevoss Bitcoin Trust on Cboe BZX (formerly Bats Exchange) for more than five years, with the original application filed on 1 July 2013.

The Winklevosses were previously rejected by the SEC in March 2017, leading them to resubmit their application, awaiting the regulator to look more favourably on the cryptocurrency market.

Since that time, the Commodity Futures Trading Commission in the US has granted approval for the listing of bitcoin futures, with Cboe becoming the first regulated exchange to list bitcoin futures in December 2017.

These developments, however, have not been enough to allay the SEC’s concerns. In its current ruling the regulator noted similar worries to before, such as that bitcoin exchanges were “still in the early stages of development” and could not be proven to be “resistant to manipulation”.

Responding to the SEC’s decision, Cameron Winklevoss said in a statement, “Despite today’s ruling, we look forward to continuing to work with the SEC and remain deeply committed to bringing a regulated Bitcoin ETF to market and building the future of money.”

Bitcoin had been rising on speculation that the SEC would grant approval for the ETF. It fell by 3.6% following the ruling.

The Winklevoss twins are not alone in having their idea for a cryptocurrency ETF turned down. The SEC has rejected several previous filings from a number of would-be providers, including those of VanEck in August 2017 and SolidX in March 2016.

Others seeking to launch their own digital asset ETFs include the Evolve Funds and ProShares—which also filed for a short (or inverse) bitcoin ETF.

If and when the SEC does give the green light for the listing of a bitcoin ETF, the decision is expected to provide a major boost to the cryptocurrency, opening it up to a wide array of mutual funds and other institutional investors.

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