The U.S. Securities and Exchange Commission (SEC) has sought public feedback on the joint Bitcoin ETF (Exchange Traded Fund) application by ARK Invest and 21Shares.
The U.S. Securities and Exchange Commission (SEC) has initiated proceedings to determine the approval process for a rule change proposal for Ark Invest and 21Shares to list and trade the Bitcoin ETF. The SEC is seeking market feedback on whether investment firms should greenlight a spot Bitcoin ETF. As part of the feedback, the SEC wants to make sure that spot Bitcoin ETFs do not pose potential risks of fraud and market manipulation.
"Given the legal and political issues posed by the proposed rule change, it is appropriate to initiate proceedings at this time," the SEC's decision said. The decision also underlined that the initiation of transactions does not mean that the commission has reached a conclusion.
The US Securities and Exchange Commission (SEC) rejected the ARK 21Shares Bitcoin ETF application in April, citing a lack of investor protection. On May 13, Cboe BZX Exchange applied to the SEC to list and trade a spot Bitcoin ETF. On July 12, the SEC extended the review period for the Bitcoin ETF application by investment firm ARK Invest and 21Shares. The US institution has not approved any spot Bitcoin ETFs to date. Bitcoin ETFs based on futures contracts, on the other hand, received approval.
What is an Exchange Traded Fund (ETF)?
An exchange-traded fund is based on an index of investment instruments such as stocks, bonds and bills. It is a mutual fund traded on securities exchanges and aims to reflect the performance of the index it is based on to investors. By investing in an exchange-traded fund, hundreds of stocks can be invested in various countries at the same time.