US SEC Rejects Approval of Bitcoin Spot-Based ETF... Bitcoin Drops 1%

[Image source=Reuters Yonhap News]

[Asia Economy New York=Correspondent Baek Jong-min] The U.S. Securities and Exchange Commission (SEC) has rejected the approval of an exchange-traded fund (ETF) based on the spot price of the cryptocurrency Bitcoin. Despite the failure to approve the spot-based ETF, the price of Bitcoin only slightly declined.

According to CNBC on the 12th (local time), the SEC denied the rule change request for the listing of VanEck's Bitcoin ETF on the BZX Exchange, a subsidiary of the Chicago Board Options Exchange (CBOE).

The SEC pointed out that CBOE failed to sufficiently demonstrate that it could prevent fraudulent trading to protect investors.

Previously, the SEC approved the ProShares ETF and Valkyrie Bitcoin Strategy ETF based on Bitcoin futures, which recently contributed to the Bitcoin rally, but it still expressed caution toward spot ETFs. To date, the SEC has not approved any Bitcoin spot ETFs.

The market expects that the introduction of spot ETFs would establish an important foundation for Bitcoin’s entry into the institutional market compared to futures ETFs, but considering the SEC’s stance, it is anticipated that a considerable amount of time will be required before approval.

CoinDesk also analyzed that "the SEC prefers futures-based ETFs over spot Bitcoin ETFs."

Bitcoin showed strength by hitting an all-time high after the introduction of futures ETFs, but on this day, it fell 1.1%, trading in the $64,000 range. CoinDesk reported that since the possibility of spot ETF approval was considered low, price fluctuations were not significant.

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