The Securities and Exchange Commission (SEC) on Wednesday has once again crushed the hopes for a Bitcoin exchange-traded fund (ETF) by rejecting Wilshire Phoenixâs rule change proposal. The New York-based investment-management firm today commented on the regulator’s decision by calling this “a great disserviceâ that causes âthe investing publicâs frustration.â
The SEC released a 76-page order where it makes a case for rejecting Phoenixâs ETF proposal that was filed together with NYSE Arca. The order made it clear that the regulator was particularly concerned about rampant market manipulations when it comes to green-lighting a Bitcoin ETF, adding that that NYSE Arca failed to satisfy the necessary requirements for the listing.
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In its recently released press release, Wilshire Phoenix states that the regulator’s feedback was very unsatisfactory after it made every effort to get the SECâs attention on this important issue. This included extensive analysis that was presented to the SEC staff, submitting key data, and offering to provide additional information to convince them of the requirement of an ETP in the crypto market.
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CryptoMom stands with Phoenix
In its filing, Phoenix presented its case that their offering was resistant to manipulation since it was created to provide investors with exposure to bitcoin through a regulated vehicle that also mitigates volatility.
However, per the federal agencyâs mandate, the filing was rejected and it remains unconvinced despite growing interest and involvement of retail investors in the virtual asset class.
SEC Comissioner Hester Peirce, aka “Crypto Mom.”
Phoenix also quoted Hester Peirce, an SEC regulator dubbed âCryptoMom,âÂ who called the commission âstodgyâ after rejecting debut of their Bitcoin ETF. Peirce has publicly disagreed with the dismissal which she described as unfounded and âevinces a stubborn stodginess in the face of innovation.â
âCommissioner Peirceâs dissent eloquently captures the investing publicâs frustration; I could not agree with her more. The SEC has created a test for bitcoin related ETPs that is clearly inconsistent with the Exchange Act. We are carefully reviewing the Order and determining the best next steps,â said Wilshireâs managing partner William Herrmann.