SEC rejects VanEck Bitcoin Trust Product

The United States Securities and Exchange Commission (SEC) decided against a move that would have let VanEck to establish a spot Bitcoin trust on March 10.

Mark Uyeda and Hester Peirce, both commissioners, issued a joint statement denouncing the commission’s refusal to allow the listing and trading of the financial instrument.

In the last six years, the SEC has declined each and every application for a spot in thet Bitcoin Trust, totaling almost twenty.

Their judgment on VanEck “repeats the analysis that the Commission has provided in each of these previous rulings,” they noted, however:

“In our view, the Commission is using a different set of goalposts from those it used—and still uses—for other types of commodity-based ETPs to keep these spot bitcoin ETPs off the exchanges we regulate.”

The government claimed that since there is no underlying regulated market, VanEck does not have a “comprehensive surveillance-sharing arrangement with a regulated market of considerable size connected to spot bitcoin.”

Notwithstanding the fact that this is a requirement for all exchange-traded products (ETPs):

“It is also clear that the Commission is using a uniquely burdensome definition of ‘significant’ in its analyses of spot bitcoin ETP filings.”

The commissioners said that the SEC had not required a link between the spot and futures markets for other commodity-based ETPs, and “substantial” seemed to be applied to the liquidity and volume of the trading venue in instances that did not include Bitcoin.

They stated that the SEC is compelled by law to explain changes to its policy regarding the approval of commodity-based ETPs.

VanEck provides a financial instrument tied to bitcoin futures. In 2017, it initiated efforts to get clearance for a spot-linked product.

The SEC waited months before deciding on the company’s current, third application for a spot ETP.

Uyeda, who was nominated by U.S. President Joe Biden and appointed to his position in June, issued a statement in February regarding the SEC’s proposed tightening of custody rules in which he stated, “This approach to custody appears to mask a policy decision to block access to crypto as an asset class.”