Breaking: SEC Returns Bitcoin ETF Applications, Triggers Massive Crypto Market Meltdown
In a move that has sent shockwaves through the global cryptocurrency market, the United States Securities and Exchange Commission (SEC) has rejected multiple applications for spot Bitcoin Exchange-Traded Funds (ETFs). The SEC cited the lack of clarity and comprehensiveness in the submitted documents as the primary reason for the rejection. This decision has led to a significant crash in the crypto market, with investors worldwide feeling the impact.
The Filing Of Spot Bitcoin ETFs Was Insufficient
Despite numerous notable applications, the US Securities and Exchange Commission (SEC) has declared recent spot Bitcoin ETF submissions as insufficient. This announcement comes in the wake of asset management powerhouses BlackRock and Fidelity filing their own proposals for spot Bitcoin exchange-traded funds.
The Wall Street Journal has reported that the SEC has communicated its views on the recent filings to Nasdaq and Cboe. The agency specifically highlighted that the applications lacked the necessary clarity and comprehensiveness, according to the report.
The SEC’s decision comes at a time when the crypto industry has been eagerly awaiting regulatory approval for Bitcoin ETFs. These financial products would allow investors to gain exposure to Bitcoin without actually owning the underlying asset, thereby simplifying the investment process and potentially bringing a wave of institutional money into the market.
In recent weeks, the digital asset sector has been taken aback by a flurry of spot Bitcoin ETF applications, notably from two titans of conventional finance, BlackRock and Fidelity. These firms, among the world’s largest asset management entities, are vying for a foothold in the industry.
However, a recent report indicates that their entry into the sector may not be a foregone conclusion. The Wall Street Journal, citing sources privy to the ongoing processes, reported that the SEC has deemed the recent spot Bitcoin ETF filings as insufficient.
Crypto Market Crashes Heavily
The SEC has a history of rejecting similar applications since 2017, often citing concerns about potential market manipulation and fraud as the reasons for their decisions. This recent development seems to contradict earlier analyses that suggested BlackRock had a 50% chance of getting their application approved.
The report further highlighted that the filings lacked sufficient details concerning the “surveillance-sharing agreements,” including the specific spot bitcoin exchange to be used. The asset managers have the option to revise and resubmit their applications, and according to the WSJ, the CBOE has expressed its intention to do just that.
In response to the news, the crypto market experienced a swift downturn within half an hour. Bitcoin (BTC) took a plunge of over 4%, dropping below the $30,000 mark, while Ethereum (ETH) fell by more than 4.5%. Bitcoin Cash (BCH) which had seen significant gains earlier in the day, experienced a decline of over 10%.
According to data from Coinglass, the total liquidation across the network surpassed $87 million within the hour, underscoring the immediate impact of the SEC’s decision on the crypto market.
