(Adds SEC quote and comment sought from SolidX, NYSE; Updates
By Trevor Hunnicutt
NEW YORK, March 28 The U.S. Securities and
Exchange Commission on Tuesday denied for the second time this
month a request to bring to market a first-of-its-kind product
tracking bitcoin, the digital currency.
The SEC announced in a filing its decision denying
Intercontinental Exchange Inc's NYSE Arca exchange the
ability to list and trade the SolidX Bitcoin Trust, an
exchange-traded product (ETP) that would trade like a stock and
track the digital asset's price. Previously, the regulatory
agency said it had concerns with a similar proposal by investors
Cameron Winklevoss and Tyler Winklevoss.
"The Commission believes that the significant markets for
bitcoin are unregulated," the SEC said in its filing, echoing
language from its decision earlier this month on the application
by CBOE Holdings Inc's Bats exchange to list The
Bitcoin ETF proposed by the Winklevoss brothers. On Friday, Bats
asked the SEC to review its decision not to allow that fund to
"We are reviewing the SEC's order and evaluating our next
steps," said Daniel H. Gallancy, chief executive officer of
SolidX Partners Inc, a U.S. technology company that provides
blockchain services. NYSE did not immediately respond to a
request for comment.
Bitcoin had scaled to a record of more than $1,300 this
month, higher than the price of an ounce of gold, as investors
speculated that an ETF holding the digital currency could woo
more people into buying the asset.
But after denial of the Winklevoss-proposed ETF, the digital
currency's price plunged as much as 18 percent. It
has rebounded partially since then and was at $1,041 on Tuesday,
roughly unchanged from the previous day.
Bitcoin is a virtual currency that can be used to move money
around the world quickly and with relative anonymity, without
the need for a central authority, such as a bank or government.
Yet bitcoin presents a new set of risks to investors given
its limited adoption, a number of massive cybersecurity breaches
affecting bitcoin owners and the lack of consistent treatment of
the assets by governments.
There is one remaining bitcoin ETP proposal awaiting a
verdict from the SEC. Grayscale Investments LLC's Bitcoin
Investment Trust, backed by early bitcoin advocate Barry Silbert
and his Digital Currency Group, filed an application last year.
(Reporting by Trevor Hunnicutt; Additional reporting by
Gertrude Chavez-Dreyfuss; Editing by David Gregorio and Cynthia