The US Securities and Exchange Commission rejected a proposal to launch an ETF that holds bitcoin directly, dashing hopes that the long-awaited product would finally be approved after the debut of a fund tied to bitcoin futures last month.
The SEC, as widely expected, rejected VanEck's offering of a new stock in Cboe Global Markets Inc. This is the first time the SEC has ruled on the issue since the launch of bitcoin futures ETFs.
In its ruling on Friday, the SEC reiterated its longstanding concerns that using bitcoin spot prices as the basis for financial products could violate securities rules because the market is so easily manipulated.
Bitcoin continued to fall after the decision, falling as much as 4.2 per cent to $62,311. The largest cryptocurrency rose to a record high of $68,991 on Monday.