US SEC Rejects VanEck’s Attempt to Launch Spot Bitcoin Trust

03/11/2023 22:55 • AI Insights • 87 views

It is reported that the United States Securities and Exchange Commission (SEC) on March 10 ordered against a rule change that allowed the investment company VanEck to create a spot Bitcoin trust. The committee members Mark Uyeda and Hester Peirce issued a statement that the SEC has rejected all the submitted applications for BTC trust, which has reached nearly 20 in the past six years. They said that the SEC’s review of ETP applicants was “double standard”. “In our view, the standards used by the Commission for other types of commodity-based ETPs are different from those used in the past and now, so as to keep these spot Bitcoin ETPs away from the exchanges we supervise.

US SEC rejects VanEck’s spot BTC trust application

Analysis based on this information:

The United States Securities and Exchange Commission (SEC) has rejected VanEck’s proposal to create a spot Bitcoin trust, according to a report released on March 10. This move comes after several years of applications for Bitcoin Trust funding, all of which were denied by the SEC. Committee members Mark Uyeda and Hester Peirce stated that the review process for ETP applicants was approached with a “double standard”.

The SEC’s decision comes as a blow to cryptocurrency enthusiasts who were hoping to see institutional investment increase in this space. A Bitcoin Trust would enable investors to indirectly invest in the cryptocurrency, essentially creating a vehicle in which to hold Bitcoin without having to purchase and custody the asset itself. Many investors have been calling for increased exposure to Bitcoin, with some even preferring it as a store of value over traditional assets such as gold.

However, the SEC’s decision may be rooted in a desire to protect investors from the risks associated with this relatively new asset class. Bitcoin’s volatile nature and lack of regulation have made it a risky investment for many, and the SEC may be hesitant to approve a fund that would allow retail investors to gain exposure to this market without fully understanding the risks involved.

Uyeda and Peirce noted that the standards that the SEC uses for other commodity-based ETPs appear to be different from those used for Bitcoin Trust applications. They believe that the SEC is unfairly preventing these types of vehicles from reaching the exchanges that they supervise, and that this approach needs to change. While these committee members may support the approval of a Bitcoin Trust, it remains to be seen whether the SEC will change its stance on this issue in the near future.

Overall, this decision by the US SEC highlights the ongoing debate around the regulation of cryptocurrencies and the need to balance innovation with investor protection. It is clear that the SEC is taking a cautious approach to approving any investment products that are tied to this emerging asset class, and this trend is likely to continue in the coming years.

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US SEC Rejects VanEck’s Attempt to Launch Spot Bitcoin Trust

US SEC rejects VanEck’s spot BTC trust application

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