Bitcoin prices surged to near record highs Wednesday after the Securities and Exchange Commission announced it was reviewing its decision to reject an application for a bitcoin exchange-traded fund proposed by the Winklevoss twins.
The SEC rejected the initial application for the Bitcoin Trust ETF in March on the grounds that any ETF must have surveillance-sharing agreements with significant markets for trading underlying commodity or derivatives on that commodity and that those markets must be regulated, which bitcoin is not.
At the time, the Bats BZX exchange, which the twins were hoping to list their ETF on, proposed a rule change that would have allowed the fund to be listed, but this was also rejected by the SEC. Bats led the charge against the finding, filing a petition for review of the Disapproval Order, which the SEC decided to grant.
In a statement, the SEC said that given the petition of review had been granted, “any party to the action or other person may file a written statement in support of or in opposition to the Disapproval Order on or before May 15, 2017,” meaning that not only can Bats and the Winklevoss twins (pictured) argue against the decision but in addition anyone else who supports the ETF being listed can also argue in its favor.
The decision by the SEC to grant a review of its rejection of the Bitcoin Trust ETF comes just shy of a month after it rejected an application by the SolidX Bitcoin ETF on similar grounds to those it used in rejecting the Winklevoss-backed ETF. Specifically, the SEC said the proposed product was not consistent with the requirement that “the rules of a national securities exchange be designed to prevent fraudulent and manipulative acts and practices and to protect investors and the public interest.” A third application for a bitcoin ETF from Grayscale Investments applied for in January remains outstanding.
Even though it’s uncertain whether the SEC will approve the Bitcoin Trust ETF a second time around, the mere fact that it might consider doing so was seen positively by bitcoin traders. The price of bitcoin stood at $1290.56 late Wednesday evening, 23 cents shy of bitcoin’s record high set March 3.