[Bitcoin Now] SEC Delays Bitcoin ETF Approval Again... Is Year-End Launch Out of Reach?

Confusion in South Korea's Cryptocurrency Market Amid Mass Delisting by Virtual Currency Exchanges
Investors Say "Losses Are Solely Investors' Burden? Exchanges Must Take Responsibility"

[Image source=AP Yonhap News]

[Asia Economy Reporter Gong Byung-sun] The leading cryptocurrency Bitcoin remained in the 45 million KRW range. While the U.S. Securities and Exchange Commission (SEC) once again postponed approval of a Bitcoin exchange-traded fund (ETF), the domestic cryptocurrency market is shaking as exchanges are mass delisting altcoins.

According to the domestic cryptocurrency exchange Upbit, as of 2:58 PM on the 17th, Bitcoin was recorded at 45.25 million KRW, down 0.10% from the previous day. It had risen to 47.5 million KRW on the 15th but has since been on a downward trend.

The launch of a Bitcoin ETF is becoming difficult. According to the U.S. economic media Bloomberg, the SEC postponed approval again for the Bitcoin ETF application submitted by the U.S. asset management firm VanEck, stating that further consideration is necessary. The SEC said it will continue to gather public opinion until July or August. VanEck’s Bitcoin ETF application was also delayed without a decision in April. On the 2nd, the approval decision for the Bitcoin ETF applied for by WisdomTree was postponed until July. The SEC can delay the review for up to 240 days if it deems additional discussion necessary.

However, it is interpreted that the launch of a Bitcoin ETF within this year will be difficult. This is the exact opposite trend from when Gary Gensler, who was favorable to cryptocurrency and blockchain, was newly appointed as SEC chairman in April. Last month, Gensler emphasized at a House Financial Services Committee hearing that “there is no regulation on cryptocurrency exchanges, exposing investors to fraud and manipulation,” and urged “Congress to step in with regulation.” In line with this, on the 12th of last month, the SEC’s Investment Management Division issued a statement saying, “Bitcoin derivatives are highly speculative and volatile assets.”

Meanwhile, the altcoin delisting wave triggered by Upbit is shaking the domestic cryptocurrency market. On the 11th, Upbit designated 25 cryptocurrencies as watchlist items and announced that 5 cryptocurrencies would be removed from the KRW market. Subsequently, small and medium-sized exchanges have been hastily delisting cryptocurrencies they issued themselves or those that are weak. Gdac announced on the 9th that it would delist its own issued cryptocurrency, Gdac Token. Currently, Gdac Token is delisted and cannot be traded. On the 15th, Coinbit announced it would end trading support for 8 cryptocurrencies and designated 28 as watchlist items. Cryptocurrencies with trading support termination announced will no longer be tradable after 8 PM on the 23rd.

The reason exchanges are rushing to clean up cryptocurrencies is that financial authorities have announced strict regulations. On this day, the Financial Services Commission announced a legislative notice for the Enforcement Decree of the Act on Reporting and Using Specified Financial Transaction Information, which prohibits handling cryptocurrencies issued by cryptocurrency operators and their special related parties. The Financial Supervisory Service requested exchanges to send lists of cryptocurrencies that have been delisted or designated as watchlist items.

However, investors expressed dissatisfaction, saying they trusted the exchanges and invested, but losses are solely borne by the investors. Mr. A, who invested in Gdac Token, said, “Gdac has long promoted the vision of Gdac Token and collected fees from investors who believed in it and invested. Gdac Token is not even listed on exchanges other than Gdac, so it cannot be transferred, yet the exchange is continuing irresponsible behavior by not offering any compensation plan.”

This content was produced with the assistance of AI translation services.