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On Friday, the U.S Securities and Exchange Commission (SEC) dealt a massive blow to crypto-currency enthusiasts by rejecting the proposal for Winklevoss twins Bitcoin Trust ETF.
They’ve stated that the unregulated nature of the Bitcoin market posed an immediate threat to its trading.
The Winklevoss twins, who’re renowned for their lawsuit against Facebook, have been working for years to tweak their proposals to set up the proposed Exchange Traded Fund (ETF).
This decision came as a major setback for the Winklevoss twins as well as the currency, causing it to tumble down by as much as 18 percent in intra-day trading, reports Bloomberg.
This is a major defeat for the Winklevoss twins who have insistently been trying to gain exemptions that would let their trust fund to publicly trade on the stock exchange.
as mentioned in
SEC rejects Winklevoss twins’ plan to trade Bitcoin as stock
As The Verge notes, the proposed Winklevoss Bitcoin Trust Exchange-Traded Fund (ETF) would have created a common stock fund tied to the price of Bitcoin.
Traders who purchased shares of the Bitcoin Trust ETF would be investing in the cryptocurrency’s value, without actually owning — or being able to spend — any Bitcoin themselves.
Although experts speculated that the price of Bitcoin would double if the Winklevoss ETF was approved, the price of Bitcoin actually sank dramatically after the SEC’s announcement.
Meanwhile, two other ETFs that were awaiting an SEC ruling are also unlikely to win approval.
While the SEC ruling is definitely a setback for the currency’s official acceptance, it’s unlikely to have a longterm effect on Bitcoin values overall and several hours after the SEC’s announcement, Bitcoin values had started to bounce back.
as mentioned in
Bitcoin drops 15% after the SEC rejects the Winklevoss ETF
The SEC just issued their ruling on the Winkelevoss bitcoin ETF, and it wasn’t good news for enthusiasts of the digital currency.
Essentially, the underlying markets that currently exist for trading bitcoin aren’t regulated enough to responsibly support an ETF that would rely on those markets for liquidity.
In its decision, the SEC explained that a Bitcoin ETF would not be consistent with current rules requiring securities exchanges to regulate and monitor the markets where underlying products are traded.
Regulators rejected the proposed application, mainly because of the lack of regulation currently surrounding bitcoin.
This is because it seems that the regulators didn’t take issue with the Winklevoss application, they were just concerned with the lack of regulation surrounding bitcoin in general .
collected by :Donald Luther