Amid SEC Concerns Fund Managers withdrawn Bitcoin ETF proposals

Several companies were planning to start bitcoin-based exchange-traded funds on various exchanges. But amid concerns from the securities and exchange commission(SEC), two companies were told to have withdrawn their proposal on Monday.

Ever since millions of new investors joined the cryptocurrency investing scene, the wall street firms were trying to ride the volatility wave by introducing various kinds of financial instruments on top of bitcoin like Bitcoin Futures which were launched on CBOE recently. But SEC seems to have put breaks on the fund managers ambitions showing that the valuation of the underlying contracts is a concern.

The launch of Bitcoin futures have added some level of validation for the decentralized digital currency and the successful launch of these on CBOE and the bigger future’s exchange CME made the wall street think they could launch similar financial instruments, but the futures contracts are governed by a different body CBFT(Commodity Futures Trading Commission), while the SEC deals with the exchange funds.

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Regulators have been trying to understand and decide on what do with the new kinds of the asset class like Bitcoin. If an ETF is approved for Bitcoin, the gates will be open for more funds based on other cryptocurrencies like Ethereum and Monero.

Some of the funds planned to launch were designed in a way to change the price of the fund twice as much as the change in Bitcoin Price. Given the extreme volatility, some analysts believe that no wonder the SEC had shown concerns about the proposed funds.

While this is going on, Bitcoin price volatility continues with the price decreasing of about $2000 in the last 3 days. The price is currently dwindling at $15000.

Edit: This is not the SEC directly declining certain ETF proposals, but rather raising concerns on the kind of funds that are currently proposed.

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