SEC Stonewalls Two Proposals for Bitcoin Listings

Intercontinental Exchange Inc’s NYSE Arca exchange has withdrawn its application to the US Securities and Exchange Commission (SEC) to list domestic bitcoin funds. The withdrawal at least temporarily stonewalls prospects to list Grayscale Investments LLC’s Bitcoin Investment Trust, citing regulatory concerns.

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Bitcoin’s meteoric rise has led to more questions than answers, especially given the recent stance taken by local authorities, namely in China. In the US, while cryptocurrency trading has caught fire, lingering concerns surrounding Regulation Regulation Like any other industry with a high net worth, the financial services industry is tightly regulated to help curb illicit behavior and manipulation. Each asset class has its own set of protocols put in place to combat their respective forms of abuse.In the foreign exchange space, regulation is assumed by authorities in multiple jurisdictions, though ultimately lacking a binding international order. Who are the Industry’s Leading Regulators?Regulators such as the UK’s Financial Conduct Authority ( Like any other industry with a high net worth, the financial services industry is tightly regulated to help curb illicit behavior and manipulation. Each asset class has its own set of protocols put in place to combat their respective forms of abuse.In the foreign exchange space, regulation is assumed by authorities in multiple jurisdictions, though ultimately lacking a binding international order. Who are the Industry’s Leading Regulators?Regulators such as the UK’s Financial Conduct Authority ( Read this Term has prevented broader offerings.

ICE had been pursuing a listing of Grayscale Investments Bitcoin trust, which if successful would have allowed investors to trade Cryptocurrencies Cryptocurrencies By using cryptography, virtual currencies, known as cryptocurrencies, are nearly counterfeit-proof digital currencies that are built on blockchain technology. Comprised of decentralized networks, blockchain technology is not overseen by a central authority.Therefore, cryptocurrencies function in a decentralized nature which theoretically makes them immune to government interference. The term, cryptocurrency derives from the origin of the encryption techniques that are employed to secure the netw By using cryptography, virtual currencies, known as cryptocurrencies, are nearly counterfeit-proof digital currencies that are built on blockchain technology. Comprised of decentralized networks, blockchain technology is not overseen by a central authority.Therefore, cryptocurrencies function in a decentralized nature which theoretically makes them immune to government interference. The term, cryptocurrency derives from the origin of the encryption techniques that are employed to secure the netw Read this Term as seamlessly as stocks, according to a Reuters report. Additionally, investment management firm Van Eck Associates Corp also yanked its own registration document for a Bitcoin fund, given the SEC’s stance on the absence of cryptocurrency futures contracts.

Grayscale Investments released a statement, indicating ongoing dialogue with US regulators: “Although digital currency market regulation continues to rapidly evolve, at this time Grayscale does not believe there have been enough regulatory developments to prompt the SEC to approve the ... application.”

Immovable Object

The stance is a temporary blow to cryptocurrency funds, though it was not unexpected. The SEC has been one of the more immovable regulators regarding cryptocurrencies, even at a time when other authorities in Europe, Canda and elsewhere appear to be warming to them.

Dedicated to less formal exchange trading, Grayscale’s Bitcoin Investment Trust trades over-the-counter (OTC) rather than typical stock trading. A successful listing would have been a watershed moment for the US cryptocurrency industry and the SEC, likely facilitating other comparable listings from exchanges.

That will have to wait for now, given the regulator’s reluctance to approve such listings as of late amidst concerns surrounding an unregulated market. Approval would be a windfall for cryptocurrency investors, and so they keep trying.

ICE and Grayscale Investments are the two latest groups to see their initial bids stifled – earlier this year the SEC also denied Bitcoin products backed by investors Cameron and Tyler Winklevoss.