- SEC has yet to approve a crypto spot exchange-traded fund
- The regulator’s work is to protect investors
- Timo Lehes says the regulator’s decision to reject VanEck’s ETF application shows crypto market is still not ready
The US Securities and Exchange Commission (SEC) once again rejected an application that sought to have a spot Bitcoin exchange-traded fund (ETF).
The disapproval, announced on Friday, shows that the market is “not ready,” according to Timo Lehes, the co-founder of BaFin regulated Swarm Markets.
VanEck’s spot BTC fund would have been physically-settled and seen investors directly track Bitcoin’s price. The SEC ruled the ETF proposal did not meet all the requirements, pointing to issues around the potential for “fraudulent and manipulative acts and practices.”
“In essence, the regulator appears unwilling to expose consumers to the market because it is still uncomfortable with how it can be gamed by powerful players,” Lehes said in a statement shared with CoinJournal.
Despite the drawback, Lehes believes the SEC is well within its mandate as it looks to fulfill its “primary function” of protecting investors.
SEC thinks the crypto market is not ready
Last month, the SEC approved the first Bitcoin futures-based ETFs in the US, an eventuality that saw the market cheer send Bitcoin prices to new all-time highs in early November.
Approval for a crypto spot ETF would take the space to the next level. But does the US securities watchdog think the market is ripe for that leap?
According to Lehes, that’s a ‘no’.
“The combination of crypto assets and spot ETFs brings together two of the biggest innovations in finance in the past 30 years. But it is clear that the regulator thinks