Keep Waiting For That Bitcoin Spot ETF: SEC Rejects WisdomTree - Again

The U.S. Securities and Exchange Commission (SEC) has once again stalled the launch of WisdomTree's Bitcoin spot ETF.

“The Commission concludes that BZX has not met its burden under the Exchange Act and the Commission’s Rules of Practice,” the order stated.

The exchange has not proven that its WisdomTree Bitcoin Trust will be structured to avoid fraudulent and manipulative activities and practices while safeguarding investors and the general welfare, according to the SEC.

So far, the company's application has been delayed twice: first in March and then in August.

WisdomTree's first application was denied citing similar reasons in December.

Since last October, the SEC has authorized a number of Bitcoin Futures ETFs, but a Bitcoin spot ETF has not yet received approval.

Bitcoin futures ETFs are supported by futures contracts with cash settlements that bet on the future value of Bitcoin. A Bitcoin spot ETF, in contrast, follows the cost of actual Bitcoin that the ETF provider owns.

Grayscale Vs. The SEC

The SEC also rejected a spot ETF application from Grayscale, considered the largest Bitcoin fund in the world.

CEO Michael Sonnhenshein decided to sue the SEC because he thought there had been fraud.

At the time, Grayscale's legal representative had claimed that the SEC was behaving arbitrarily and capriciously in violation of the Administrative Procedure Act and Securities Exchange Act of 1934 by failing to apply identical treatment to similar investment vehicles.

Meanwhile, several spot ETFs for both Bitcoin and Ethereum have already received approval outside of the U.S., including Canada and Australia.

See Also: Grayscale Partners With Foundry On New Bitcoin Mining Product