While the SEC has already approved two Bitcoin (BTC) Futures ETFs last month, it has now rejected the filing of VanEck for the Spot ETF. 

After an underperformance of the market and momentum loss, the Securities and Exchange Commission (SEC) has not approved the Spot Bitcoin (BTC) ETF filed by VanEck in March 2021. 

The SEC issued a report confirming the rejection on Friday. Apparently, the VanEck Bitcoin Trust “didn’t meet its burden under the Exchange Act and the Commission’s Rules of Practice to demonstrate that its proposal is consistent with the requirements of Exchange Act Section 6(b)(5).” This came as a result of a proposition change from CBOE BZX Exchange for listing and trading the shares of the Bitcoin Fund of VanEck, and this did not comply with the Exchange Act Section 6(b)(5). 

Jan van Eck, CEO of VanEck tweeted his dismay over the decision of the SEC, saying that “We are disappointed in today’s update from the SEC declining approval of our physical bitcoin ETF.  We believe that investors should be able to gain #BTC exposure through a regulated fund and that a non-futures ETF structure is the superior approach.”

We are disappointed in today’s update from the SEC declining approval of our physical bitcoin ETF. We believe that investors should be able to gain #BTC exposure through a regulated fund and that a non-futures ETF structure is the superior approach. @tyler @gaborgurbacs

— Jan van Eck (@JanvanEck3) November 12, 2021

Per the remarks for The Future of Asset Management North America Conference, SEC Chairman Gary Gensler stated his endorsement for Bitcoin Futures ETFs. Because of the framework of the contractual obligation in the two situations, the SEC’s perspective has been criticized by firms filing for spot ETFs.

The head of VanEck Digital Assets Research, Michael Sigel in an interview with Bloomberg posited that “we see bitcoin futures-based funds as inferior products that have consistently underperformed the Bitcoin price and bring additional complexities in regards to how they must be managed, at a higher cost than ETFs. (..) What the SEC seems to be doing is pushing individual investors into higher-risk, lower quality products to get their Bitcoin exposure instead of sticking with the tried-and-true ETF wrapper.”

The decision of the SEC negatively affected the cryptocurrency market, causing Bitcoin (BTC) to take a dive to $64k. The biggest cryptocurrency is presently trading at 63,619.05.

Also read: Miami Coin to Issue BTC Dividends to Miami Residents