Denied: Here is the SEC Order Denying the Winkelvoss Bitcoin Trust
- Author: Eleanor Harrison Mar 13, 2017,
Mar 13, 2017, 0:19
The Securities and Exchange Commission is set to grant or deny approval of the Winklevoss Bitcoin Trust ETF, an exchange-traded fund that would track the value of digital currency bitcoin. But the doors are not completely closed.
The first to solve the puzzle and clear the transaction is rewarded with new bitcoins.
Bitcoin's steady climb to beat the gold standard began after President Donald Trump's election - and some think his presidency will make its value surge even higher. The Commission notes that bitcoin is still in the relatively early stages of its development and that, over time, regulated bitcoin-related markets of significant size may develop. "How do we develop well-capitalized and regulated markets in the USA and Europe if financial innovators aren't allowed to bring products to market that grow domestic demand for digital currencies like Bitcoin?"
The decision immediately sent the price of the crypto-currency down 14 percent, to about $1,022.68 after the decision, which came shortly after the market closed. Bitcoin is undervalued as it is already, and the potential for future gains is very real. However, it managed a recovery after the fall and closed at $1090. On Saturday, prices continued its recovery to $1144 levels.
At one point earlier in March bitcoin made headlines when it surpassed the value of a fine ounce of gold, or almost $1,300 (1,230 euros).
Global majors like Paypal and Microsoft also accepts it as a currency for consideration of goods or services.
The proposed Bitcoin ETF was the brainchild of Cameron and Tyler Winklevoss, twin brothers who once sued Mark Zuckerberg for allegedly stealing the idea behind Facebook from them when they were all students at Harvard.
An approval would have meant that the public could invest in bitcoin simply by purchasing shares in the ETF, which would trade on a U.S-based stock exchange.
"The significant markets for bitcoin are unregulated", the agency said in the order. But the SEC saw little evidence that these conditions were met. Bitcoin is primarily traded in unregulated markets located overseas, especially in China, and as a result, the price of bitcoins is extremely volatile.
"We began this journey nearly four years ago, and are determined to see it through", he added, referring to the brothers' first ill-fated attempt at trading the currency via the Winklevoss Bitcoin Trust.
"We agree with the SEC that regulation and oversight are important to the health of any marketplace and the safety of all investors".