SEC denies VanEck spot BTC trust product, commissioners see double standard
SEC Commissioners Mark Uyeda and Hester Peirce have issued a joint statement highlighting discrepancies they see in the application of standards to applicants for ETPs.
On March 10, the United States Securities and Exchange Commission ruled against a change that would allow investment manager VanEck to create a spot Bitcoin (BTC) trust. Commissioner Mark Uyeda joined his colleague Hester Peirce in releasing a statement criticizing the commissionâs decision not to approve the listing and trading of the financial product.Â
The commissioners noted that the SEC had denied every application for a spot Bitcoin trust that ha been filed, amounting to almost 20 over the last six years. Its decision on VanEck ârepeats the analysis that the Commission has given in each of these recent orders,â they said, but:
âIn our view, the Commission is using a different set of goalposts from those it usedâand still usesâfor other types of commodity-based ETPs to keep these spot bitcoin ETPs off the exchanges we regulate.â
The agency argued that there is no underlying regulated market and therefore VanEck has no âcomprehensive surveillance-sharing agreement with a regulated market of significant size related to spot bitcoin.â While that is a requirement applied to all exchange-traded products (ETPs):
âIt is also clear that the Commission is using a uniquely burdensome definition of âsignificantâ in its analyses of spot bitcoin ETP filings.â
The commissioners said the SEC had not required any connection between the spot and futures markets to be demonstrated for other commodity-based ETPs, and âsignificantâ seemed to be applied to liquidity and volume of the trading venue in cases that do not involve Bitcoin. The SEC is required by law to explain changes to its policy for approving commodity-based ETPs, they added.
Related: Hereâs why the SEC keeps rejecting spot Bitcoin ETF applications
VanEck has a Bitcoin futures-linked financial product. It began its attempts to gain approval for a spot-linked product in 2017. The SEC delayed making a decision on the companyâs current, and third, application for a spot ETP for months.
Bull and Bear Arguments for Bitcoin – February 2023: https://t.co/hSVCdzoUD5
â FENERATOR Capital (@feneratorcom) March 5, 2023
Uyeda, who was nominated by U.S. President Joe Biden and appointed to his post in June, released a statement on the SECâs proposed toughening of custody rules in February, in which he stated, âThis approach to custody appears to mask a policy decision to block access to crypto as an asset class.â