Two US companies ditched plans to launch Bitcoin (EXANTE: Bitcoin) exchange-traded funds, (ETFs) citing ongoing concerns by the Securities and Exchange Commission (SEC), Reuters reported.
Trusts controlled by Rafferty Asset Management LLC and Exchange Traded Concepts LLC each canceled plans to launch three Bitcoin funds that could be traded by retail investors as easily as stocks.
One of the filing states SEC “expressed concerns regarding the liquidity and valuation” of futures contracts based on the digital asset.
Fund managers thought the proposals had a chance at winning approval given the launch last month of futures contracts based on Bitcoin on both the CME and the CBOE exchanges.
The move opens a public divergence between two financial regulatory agencies - SEC and Commodity Futures Trading Commission (CFTC) - over how to regulate cryptocurrencies and no single one has control.
The SEC has dominion over funds, while the CFTC governs futures contracts. The CFTC has been under pressure to address concerns it did not fully assess the potential risks that Bitcoin poses to the financial system.