SEC Disapproves of Valkyrie’s and Kryptoin’s Bitcoin ETF Proposals

The US Securities and Exchange Commission (SEC) has rejected two more physically backed Bitcoin exchange-traded funds (ETFs). These were the ETFs suggested by Valkyrie and Kryptoin respectively.

The proposals are not in line with the law, SEC says

Both decisions that you here and here can read, arrived on Wednesday. The SEC made the same arguments it used in the past when it rejected other applications.

According to the Commission, NYSE Arca and Cboe BZX Exchange, which have filed respective proposed rule changes to list and trade Valkyrie and Kryptoin products, “have failed to demonstrate that their proposals comply with the requirements of Exchange Act Section 6(b) (5).”

The SEC stated that this relates specifically to the requirement that a national stock exchange must be “designed to prevent fraudulent and manipulative acts and practices.” It must also “protect investors and the public interest”.

An ETF is an investment tool that allows investors to buy stocks that track the price of an underlying asset. A Bitcoin ETF, as the name suggests, is said to provide exposure to Bitcoin. This would save the hassle of buying the cryptocurrency from an exchange and managing the private keys.

The SEC has repeatedly made all efforts to Bitcoin ETF launch rejected or delayed. However, US investors do have access to such products north of the border in Canada, meanwhile. Earlier this year, however, the regulator gave the green light to several Bitcoin futures ETFs. These are linked to the Chicago Mercantile Exchange (CME) derivatives markets.

No Bitcoin ETF in 2021

The Commission’s latest move means the market will not see a Bitcoin ETF this year, with key dates next month.