{"id":13139,"date":"2021-11-12T18:51:41","date_gmt":"2021-11-12T18:51:41","guid":{"rendered":"http:\/\/ci0292172200002693"},"modified":"2021-11-12T18:51:41","modified_gmt":"2021-11-12T18:51:41","slug":"sec-rejects-vaneck-spot-bitcoin-etf","status":"publish","type":"post","link":"https:\/\/bitcoinmagazine.com\/markets\/sec-rejects-vaneck-spot-bitcoin-etf","title":{"rendered":"US SEC Rejects VanEck Spot Bitcoin ETF"},"content":{"rendered":"<div id=\"bsf_rt_marker\"><\/div><ul>\n<li>The SEC has rejected VanEck\u2019s spot bitcoin ETF proposal.<\/li>\n<li>The filer had not demonstrated that its proposal abides by the national requirements for such an offering, the SEC explained in a disapproval letter.<\/li>\n<li>It is unclear when the commission would feel comfortable approving a spot BTC ETF in the U.S., but investors can still acquire bitcoin themselves&nbsp;<em>\u2014<\/em>&nbsp;a better option.<\/li>\n<\/ul>\n<p>The VanEck <a href=\"https:\/\/bitcoinmagazine.com\/guides\/spot-bitcoin-etf\">spot bitcoin exchange-traded fund (ETF)<\/a> has been rejected by the Securities and Exchange Commission (SEC), according to a disapproval letter released on November 12.<\/p>\n<p>The fund sought direct bitcoin exposure by holding BTC and offering related shares to U.S. investors. However, the SEC hasn\u2019t conceded to the public\u2019s demand and remains skeptical of such an offering.<\/p>\n<p>The Cboe BZX Exchange <a href=\"https:\/\/cdn.cboe.com\/resources\/regulation\/rule_filings\/pending\/2021\/SR-CboeBZX-2021-019.pdf\" target=\"_blank\" rel=\"noopener\">filed<\/a> with the SEC in March, proposing a rule change to list and trade shares of the VanEck Bitcoin Trust. After the SEC delayed the analysis of the filing several times throughout the year, it reached a conclusion in the letter released today.<\/p>\n<p>\u201cBZX has not met its burden&#8230;to demonstrate that its proposal is consistent with&#8230;the requirement that the rules of a national securities exchange be \u2018designed to prevent fraudulent and manipulative acts and practices\u2019 and \u2018to protect investors and the public interest,\u2019\u201d per the disapproval letter.<\/p>\n<p>The SEC further explained that an exchange seeking to offer a spot bitcoin ETF in the U.S. could meet such obligations by demonstrating that it has a \u201ccomprehensive surveillance-sharing agreement with a regulated market of significant size\u201d related to bitcoin.<\/p>\n<p>In short, the commission is worried that if a spot bitcoin ETF were to go live in the country and a person were to manipulate it, the SEC wouldn\u2019t be able to detect the manipulation and apply the necessary investor protection measures as it argues there is currently not a \u201cregulated market of significance size\u201d for spot bitcoin.<\/p>\n<p>The Cboe also posed questions about the approval of bitcoin futures ETFs in its proposal and how those could hardly give more investor protections than a spot offering. It highlighted that although the derivatives-based approved offerings were filed under a different Act than Cboe\u2019s product, the fact that the SEC doesn\u2019t consider the Chicago Mercantile Exchange (CME) bitcoin futures market a regulated one of significant size could mean a double standard in treatment by the commission.<\/p>\n<p>However, the SEC wrote that it \u201cdisagrees with the premise\u201d of Cboe\u2019s argument, and claimed it \u201cconsiders the proposed rule change on its own merits and under the standards applicable to it.\u201d<\/p>\n<p>\u201cIt\u2019s such a good point, but SEC doesn\u2019t care,\u201d <em>Bloomberg Intelligence<\/em> ETF analyst Eric Balchunas <a href=\"https:\/\/twitter.com\/EricBalchunas\/status\/1459206229499199494?s=20\" target=\"_blank\" rel=\"noopener\">tweeted<\/a>. \u201cNot having it. Basically logic and reason and trumped by technical legality.\u201d<\/p>\n<p>While the SEC doesn\u2019t approve a <a href=\"https:\/\/bitcoinmagazine.com\/guides\/what-is-a-bitcoin-etf\">bitcoin ETF<\/a> that would hold actual coins, interested investors can acquire BTC in a self-sovereign way. What was once a complicated process is now fairly frictionless; investors can <a href=\"https:\/\/bitcoinmagazine.com\/guides\/bitcoin-wallets-for-beginners-from-zero-to-self-custody-of-kyc-free-btc\">start small<\/a> and <a href=\"https:\/\/bitcoinmagazine.com\/guides\/how-to-establish-mobile-bitcoin-privacy-with-a-pixel-4a-and-calyxos\">build up from there<\/a>. The benefits of <a href=\"https:\/\/bitcoinmagazine.com\/guides\/bitcoin-wallets-for-beginners-part-one-self-custody-and-avoiding-kyc\">self-custody<\/a> far outweigh the learning curve and enables users to truly participate in Bitcoin and benefit from the network\u2019s <a href=\"https:\/\/bitcoinmagazine.com\/culture\/bitcoin-replacing-us-super-imperialism\">value proposition<\/a>.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>The commission released a disapproval letter citing investor protection concerns and the lack of manipulation prevention in the market.<\/p>\n","protected":false},"author":2572,"featured_media":2748,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[34],"tags":[212,183,547],"class_list":["post-13139","post","type-post","status-publish","format-standard","has-post-thumbnail","category-markets","tag-bitcoin-etf","tag-sec","tag-vaneck"],"author_data":{"id":2572,"name":"Namcios","nicename":"namcios","avatar_url":"https:\/\/bitcoinmagazine.com\/wp-content\/uploads\/2024\/12\/pfp-96x96.png"},"featured_image_url":"https:\/\/bitcoinmagazine.com\/wp-content\/uploads\/2024\/11\/sec-seeks-comments-on-another-bitcoin-etf.jpg","_links":{"self":[{"href":"https:\/\/bitcoinmagazine.com\/wp-json\/wp\/v2\/posts\/13139","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/bitcoinmagazine.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/bitcoinmagazine.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/bitcoinmagazine.com\/wp-json\/wp\/v2\/users\/2572"}],"replies":[{"embeddable":true,"href":"https:\/\/bitcoinmagazine.com\/wp-json\/wp\/v2\/comments?post=13139"}],"version-history":[{"count":0,"href":"https:\/\/bitcoinmagazine.com\/wp-json\/wp\/v2\/posts\/13139\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/bitcoinmagazine.com\/wp-json\/wp\/v2\/media\/2748"}],"wp:attachment":[{"href":"https:\/\/bitcoinmagazine.com\/wp-json\/wp\/v2\/media?parent=13139"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/bitcoinmagazine.com\/wp-json\/wp\/v2\/categories?post=13139"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/bitcoinmagazine.com\/wp-json\/wp\/v2\/tags?post=13139"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}