In a filing Friday morning, the SEC said it was not confident the VanEck Bitcoin Trust could offer protections from the volatile price swings and potential manipulation in the market for the world’s largest cryptocurrency.
In particular, the regulatory body said Cboe Global Markets, the exchange of choice for the VanEck application, still lacks a surveillance-sharing agreement to detect fraud.
“Such resistance to fraud and manipulation, however, must be novel and beyond those protections that exist in traditional commodity markets or equity markets for which the Commission has long required surveillance sharing agreements in the context of listing derivative securities products.
Laura Morrison, Cboe’s head of ETF listings, said clinching surveillance agreements with the number of exchanges that trade bitcoin around the world would be “daunting,” and a potentially impossible task.
CEO Matthew Hougan explained on Twitter that BITO and BTF have already taken all the excess capacity for near-month contracts with futures merchants, making a near-month bitcoin futures ETF launch difficult.