The U.S. Securities and Exchange Commission (SEC) has issued an order on October 9, rejecting the bitcoin exchange-traded fund (ETF) proposal from Bitwise Asset Management.
The regulator stated that the proposal filed by Bitwise Asset Management in conjunction with NYSE Arca does not meet the legal requirements necessary to prevent illicit activities such as market manipulation.
According to the order, the commission disapproves the proposed rule changes, because “NYSE Arca has not met its burden” to demonstrate the proposal’s consistency with the Exchange Act designed to prevent illicit activities.
Bitwise Asset Management filed its ETF proposal in January. According to comments made by the company, another proposal will be made. The firm considers this negative outcome as a “productive step”.
Matt Hougan, Bitwise’s Global Head of Research, stated that the SEC order provided the company with “critical context and a clear pathway for ETF applicants to continue moving forward on efforts to list a bitcoin ETF”.
As COIN360 reported earlier, SEC recently started proceedings on the Wilshire Phoenix Bitcoin ETF product.