SEC Rejects Bitwise’s Latest Bitcoin ETF Proposal

[alyssa85]

see

The U.S. Securities and Exchange Commission (SEC) has rejected the latest attempt at creating a bitcoin exchange-traded fund (ETF).

The SEC announced Wednesday that the ETF proposal, filed by Bitwise Asset Management in conjunction with NYSE Arca, did not meet legal requirements to prevent market manipulation or other illicit activities. The SEC placed the burden on NYSE Arca, rather than Bitwise’s proposal itself.

To date, the SEC has rejected all bitcoin ETF proposals, citing market manipulation and fraudulent activity concerns.

It's now five years since the Winklevoss twins first tried to get an ETF off the ground. And the problem remains the same - as long as the bulk of the trading takes place on exchanges that allow manipulation, the SEC can't approve the ETF, because the dodgy exchanges set the price.

If bitcoiners really want to see an ETF happen, they need to move their trading away from Binance and co, and towards Gemini, Coinbase and the other regulated exchanges.

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[BitHodler]

Was to be expected, especially after Vaneck's withdrawal of their application. Looking at the market, there seems to be no reaction at all, which is a good thing because people need to stop focusing on ETFs.

I don't believe that we're even much closer than before with how the manipulation and wash trading concerns can't be solved from within the states. It gives the SEC enough reason to continue rejecting applications.

Another important factor is that an ETF might not turn out to be attracting a whole lot of demand, especially when the entry point is a few hundred k and institutions aren't interested to gain exposure through an ETF.

[alyssa85]

I don't believe that we're even much closer than before with how the manipulation and wash trading concerns can't be solved from within the states. It gives the SEC enough reason to continue rejecting applications.

The only thing that will persuade the SEC is if it can be proved that the bulk of trading happens in regulated exchanges that it trusts.

The Japanese are trying to promote the idea of a standard regulation of crypto that applies across the world - they talked about it at one of the G7 meetings earlier in the year.

They actually got the G7 to approve Japan's cryptocurrency Swift alternative which Japan is currently developing:

https://cointelegraph.com/news/g7-approves-japans-cryptocurrency-based-swift-alternative

Once there is a standard, then in theory the SEC could approve an ETF if more than say 66% of global bitcoin trading took place on exchanges regulated by the common standard, and hence they could trust the prices were not being manipulated.

But as long as exchanges like Binance exist, with their Tether shenanigans, an ETF is dead in the water.

[ecnalubma]

We can't blame regulators to keep on rejecting proposals like this if its against their regulations. Exchanges should follow the right protocol and abide with the rules, any single mistake will led to postponement of their proposals the regulators are only after for the balance and fairness of the ecosystem.   

[NathanJB]

When this ETF topic started to make it to the news, people were very excited just like when Bakkt also created a huge stir among the crypto community. But, just like Bakkt also, the hype surrounding ETF and its anticipation have all died down after a few attempts were repeatedly rejected. If we look at the movements of BTC price, it is already fully detached from ETF news. This was what happened to Bakkt as well. It is therefore logical that even if an ETF is finally approved by the SEC, the prices will not anymore react.

[asus09]

Latest new SEC have reject bitcoin proposal, have negative side with reject by SEC but we are waiting for good respond with many bitcoin investor keep trust with bitcoin and altcoin, always give positive think with bitcoin and altcoin become legal next time with many country adopt for bitcoin and altcoin as currency payment.

[elda34b]

How many threads do we need for this one?

We have three already. No need to repeat the discussion over and over again.

[electronicash]

we only have to trade in Gemini so ETF will be approved. we don't even know if this ETF will really bring the price up and also help adoption for everyone. this is not going to be happening since this is supposedly a decentralized market, the crypto guys are building more dex. Bitwise and the twins can forget about their proposals.
i don't think all cares this ETF getting approved anyway. like they said BTC is going to moon without ETF.

[CryptoBry]

When this ETF topic started to make it to the news, people were very excited just like when Bakkt also created a huge stir among the crypto community. But, just like Bakkt also, the hype surrounding ETF and its anticipation have all died down after a few attempts were repeatedly rejected. If we look at the movements of BTC price, it is already fully detached from ETF news. This was what happened to Bakkt as well. It is therefore logical that even if an ETF is finally approved by the SEC, the prices will not anymore react.

Yes, I remember those days when the much-sought approval of an ETF is considered to be something that can save Bitcoin from the hands of the bears. Together with Bakkt, ETF is supposed to be the platform where institutional money can come in and be a part of the Bitcoin bandwagon without them directly owning one. Unfortunately, the same problems (like manipulations & wash trading) before are still with us today and so SEC has no other better recourse of action than deciding against it.

Definitely, it is not yet the time for ETF. With the way the market poured cold ICE-water into the recent Bakkt introduction, I would not be surprised if the same reception can also happen to ETF in case an application was approved by SEC. That would have been a big disaster. Good thing that Bitcoin does not mind at all and seems oblivious to the ETF thing and this can mean that we are already beyond the ETF hypes and hopefully soon we can also shake away the Bakkt hang-over.

[The Sceptical Chymist]

I haven't been following any of the ETF happenings very closely, so thank for posting the article OP.

If bitcoiners really want to see an ETF happen, they need to move their trading away from Binance and co, and towards Gemini, Coinbase and the other regulated exchanges.

Meh.  I consider myself a bitcoiner (not a big owner of it, though I would be if I had the money) and I would be OK if ETFs never saw the light of day.  There's still bitcoin to be bought and sold, and the only problem is that people with really deep pockets can't buy billions of dollars worth of it without either cornering the market and getting stuck or driving up the price while they're buying.  That's why Bakkt is so important, though even that doesn't seem to be making a huge impact thus far.

I do agree about the regulated exchanges statement, however.  But Binance is now a regulated exchange if I'm not mistaken--that's why they launched a US site and had to exclude a few states in the process.  Traders really shouldn't be using sketchy, unregulated exchanges like Yobit and all the others, if only for their safety.

[avikz]

see

The U.S. Securities and Exchange Commission (SEC) has rejected the latest attempt at creating a bitcoin exchange-traded fund (ETF).

The SEC announced Wednesday that the ETF proposal, filed by Bitwise Asset Management in conjunction with NYSE Arca, did not meet legal requirements to prevent market manipulation or other illicit activities. The SEC placed the burden on NYSE Arca, rather than Bitwise’s proposal itself.

To date, the SEC has rejected all bitcoin ETF proposals, citing market manipulation and fraudulent activity concerns.

It's now five years since the Winklevoss twins first tried to get an ETF off the ground. And the problem remains the same - as long as the bulk of the trading takes place on exchanges that allow manipulation, the SEC can't approve the ETF, because the dodgy exchanges set the price.

If bitcoiners really want to see an ETF happen, they need to move their trading away from Binance and co, and towards Gemini, Coinbase and the other regulated exchanges.

Rejection was well envisaged! No one of us really expected to see it otherwise! But what you are soliciting here, will bring doomsday to the crypto market! Moving the trading volume to centralized and regulated exchanges will actually kill the essence of cryptocurrency! ETF is not the necessity of the crypto market! Learn to prioritize!

[teosanru]

see

The U.S. Securities and Exchange Commission (SEC) has rejected the latest attempt at creating a bitcoin exchange-traded fund (ETF).

The SEC announced Wednesday that the ETF proposal, filed by Bitwise Asset Management in conjunction with NYSE Arca, did not meet legal requirements to prevent market manipulation or other illicit activities. The SEC placed the burden on NYSE Arca, rather than Bitwise’s proposal itself.

To date, the SEC has rejected all bitcoin ETF proposals, citing market manipulation and fraudulent activity concerns.

It's now five years since the Winklevoss twins first tried to get an ETF off the ground. And the problem remains the same - as long as the bulk of the trading takes place on exchanges that allow manipulation, the SEC can't approve the ETF, because the dodgy exchanges set the price.

If bitcoiners really want to see an ETF happen, they need to move their trading away from Binance and co, and towards Gemini, Coinbase and the other regulated exchanges.

You mean to say disobey the Very essence of Cryptocurrencies which is anonymity? I think SEC is right on their part. Bitcoin ETF is really not the need of hour. Need of hour is to make distribution bitcoin much more rational. Manipulations are possible because of imbalances whales manipulate the market in their own way. Investors outside the Crypto world aren't really in habit of such chronic volatility. Volatility can only come down with some equal distribution so I think only when the Volatility comes down ETF would be approved.

see

The U.S. Securities and Exchange Commission (SEC) has rejected the latest attempt at creating a bitcoin exchange-traded fund (ETF).

The SEC announced Wednesday that the ETF proposal, filed by Bitwise Asset Management in conjunction with NYSE Arca, did not meet legal requirements to prevent market manipulation or other illicit activities. The SEC placed the burden on NYSE Arca, rather than Bitwise’s proposal itself.

To date, the SEC has rejected all bitcoin ETF proposals, citing market manipulation and fraudulent activity concerns.

It's now five years since the Winklevoss twins first tried to get an ETF off the ground. And the problem remains the same - as long as the bulk of the trading takes place on exchanges that allow manipulation, the SEC can't approve the ETF, because the dodgy exchanges set the price.

If bitcoiners really want to see an ETF happen, they need to move their trading away from Binance and co, and towards Gemini, Coinbase and the other regulated exchanges.

Rejection was well envisaged! No one of us really expected to see it otherwise! But what you are soliciting here, will bring doomsday to the crypto market! Moving the trading volume to centralized and regulated exchanges will actually kill the essence of cryptocurrency! ETF is not the necessity of the crypto market! Learn to prioritize!

Exactly ETF i think is just an imaginary idea i Don't even think that it would have any major effect on price. Moreover reality is that ETF makes BTC looks more like a security instead of currency.

[1Referee]

But as long as exchanges like Binance exist, with their Tether shenanigans, an ETF is dead in the water.

Tether is such a blast unfortunately.

No matter how much volume regulated US exchanges such as Coinbase generate, it will never be enough to outpace Binace, Huobi, Okex, etc. These exchanges hold most of the Tether supply in their addresses, which means that they have the incentive to keep people on their platform trading it.

What also contributes to Tether's dominance is the fact that it is so damn hard to liquidate into real dollars. It means that those who were stupid enough to sell their precious Bitcoins to Tether will be forced to pump it back into the market eventually. From one stupid person selling Bitcoin to Tether it goes to another stupid person selling his Bitcoin to Tether. It keeps the market alive and kicking.

The SEC isn't stupid either; Bitcoin stopped pumping the moment Tether stopped excessively printing fake money. Even if it was pure coincidence, I'm sure they have that weigh in. 

[styca]

SEC rejection of a bitcoin ETF will not have any effect on price. Everyone already assumes in advance that there will be a rejection. It's priced in. Approval on the other hand would presumably have a big impact on price as it would be so unexpected. But rejection? Not really. There have been so many of them, another one is neither here nor there. I'm sure one will be approved eventually, but we are likely talking years at the least.

The SEC isn't stupid either; Bitcoin stopped pumping the moment Tether stopped excessively printing fake money. Even if it was pure coincidence, I'm sure they have that weigh in. 

Yes, it's stuff like this that means approval is still a long way off.

[serjent05]

Was to be expected, especially after Vaneck's withdrawal of their application. Looking at the market, there seems to be no reaction at all, which is a good thing because people need to stop focusing on ETFs.

I don't believe that we're even much closer than before with how the manipulation and wash trading concerns can't be solved from within the states. It gives the SEC enough reason to continue rejecting applications.

Another important factor is that an ETF might not turn out to be attracting a whole lot of demand, especially when the entry point is a few hundred k and institutions aren't interested to gain exposure through an ETF.

This mean traders already accepted the fact that this ETF proposal will be rejected.  It had been for how many year?  What would be the difference it would make today.  

The only thing that will persuade the SEC is if it can be proved that the bulk of trading happens in regulated exchanges that it trusts.

Indeed, unregulated exchanges, DEX'es, this surely hindered  the ETF approval.  Since SEC cannot verify the validity if the trade occured naturally.

Once there is a standard, then in theory the SEC could approve an ETF if more than say 66% of global bitcoin trading took place on exchanges regulated by the common standard, and hence they could trust the prices were not being manipulated.
But as long as exchanges like Binance exist, with their Tether shenanigans, an ETF is dead in the water.

This make sense Binance, had been shady and known to manipulate trades in their platform.