In a blow to crypto traders, the Securities and Exchange Commission is holding off approval of the first Bitcoin exchange-traded fund (ETF).

Why should we care?
This isn’t the first time the SEC has avoided making a decision on a Bitcoin-linked ETF. The proposal in question concerns ETF provider VanEck’s proposed bitcoin product, for which the regulator decided not to make a decision in April. At the time, it said it needed more time. Now, the SEC is putting forward a document for public comments, asking the questions that include whether the trust and shares associated with the ETF would be susceptible to manipulation. It’s also asking how transparent Bitcoin is. The SEC’s hesitation to weigh in dampens earlier enthusiasm among crypto advocates regarding SEC Chair Gary Gensler, who once taught courses about digital assets at MIT. But the regulator appears to be skeptical about the risks associated with Bitcoin-linked funds and a lack of oversight. The SEC has received about a dozen bitcoin ETF proposals over the past eight years, but has not approved any of them, citing concerns with investor protection. “In rejecting numerous bitcoin ETF applications, the SEC has continually stated concerns over fraud and manipulation in the underlying bitcoin spot market,” Nathan Geraci, president of the ETF Store, said in a recent interview. “The SEC is worried they don’t have proper surveillance over crypto exchanges and, therefore, can’t ensure adequate investor protections are in place.”