What's in this article
The U.S. Securities and Exchange Commission (SEC) has rejected a Bitcoin spot ETF put forward last year by Ark 21 shares.
The SEC rejected Ark 21 shares’ ETF scheme during a regulatory filing which was announced on its website on Mar. 31.
If the synergy between the Florida-based Ark invest and the Switzerland-based 21shares was efficient, the ETF might have been provided on the CBOE BZX Exchange.
This offer of rule change that would have accommodated the ETF was filed in July 2021. The CEO of Ark Invest, Cathie Wood, has indicated a positive attitude towards the acclamation of a Bitcoin ETF in recent months due to the assignment of Gary Gensler as SEC chair.
Nonetheless, the SEC, in the long run, rejected the ETF as a result of the insufficiency of the Cboe BZX exchange’s rules to adequately protect investors or prevent fraudulent activities in the market.
Bitcoin ETF Set To Arrive By 2023
Furthermore, applications from NYDIG and Global X were earlier disapproved by the SEC on Mar. 11 on similar grounds. The SEC has also rejected propositions from Fidelity, VanEck, and WisdomTree over the past several months.
While the SEC’s adherence to various Bitcoin futures ETFs last autumn in the first instance, appeared to be making provision for a spot ETF, persistent rejections of spots ETFs proposals seem to diminish the chances of successful approval in the near future
Following the fallout, a few firms have already given responses to the SEC’s on-slaught of rejections: Grayscale has campaigned to solicit support for its ETF, and the firm says that it might resort to sue the SEC if its application is denied.
A Bitcoin spot ETF is designed to be a novel investment: an investment that tracks the price of Bitcoin without needing investors to actually buy or own Bitcoin. Although alternative investment funds like GBTC serve this purpose, an ETF would be unrestricted rather than locked, meaning that shares could be issued to accommodate changing demand.
A few experts believe that a Bitcoin spot ETF could be ready in 2023, as SEC directives about exchanges are likely to change.