Most of us on #cryptotwitter were expecting the ETFs to be rejected.
The only ETF left now is the VanEck/SolidX commodity-backed offering.
Basically, the decision came down to the risk of market manipulation & fraud. The SEC can only approve an ETF that is "designed to prevent fraudulent and manipulative acts and practices." In the SEC's view, these ETFs were not.
- bitcoin markets are not inherently resistant to manipulation
- to deter manipulation, exchanges need a surveillance-sharing agreement with a regulated market of significant size
In theory, this gave derivative-backed ETFs a better chance of approval than commodity-backed ETFs, which use unregulated spot markets.
They even cited #cryptotwitter favorite Chris Giancarlo, CFTC Chairman, who characterized the volume of the futures markets as "quite small."
They didn't actually cite BitMEX or Bitfinex, but . . . you know.
This makes me wonder if they'll approve *any* ETF before spot markets are regulated, which may be a while.
(i) a surveillance-sharing agreement . . .
(ii) with a regulated market . . .
(iii) of significant size.
That seems like a tough request to satisfy in 2018.
The only ETF deadline left, and the only one most of us cared about in the first place: VanEck/SolidX on September 30.