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Bitcoin price (BTC/USD) tumbles as SEC rejects new ETF proposals

on Aug 23, 2018
Updated: May 24, 2024

The Bitcoin price (BTC/USD) has seen a significant pull-back after hitting a two-week high above $6,800 in yesterday’s trading.

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The original cryptocurrency jumped to a two-week high of $6,816.79 in the early hours of yesterday’s session. Some observers attributed the spike to the temporary shutdown of crypto exchange BitMex, which went offline around the same time, as part of a scheduled maintenance. While the coin pulled back in subsequent trading, it remained in the $6,600 – $6,700 range for a large portion of the session.

However, the digital currency experienced a much more significant drop in late afternoon trading, with its price plunging to an intraday low of $6,310.11. Bitcoin eventually finished the day at $6,376.71, down from its opening level of $6,486.25.

Yesterday’s steep drop was most likely driven by the SEC’s rejection of several Bitcoin exchange-traded-fund proposals. The US securities industry regulator yesterday rejected nine ETF proposals from ProShares, Direxion and GraniteShares. As noted by industry website Coindesk, the commission used the same reasoning in all of its rejections.

“…the Commission is disapproving this proposed rule change because, as discussed below, the Exchange has not met its burden under the Exchange Act and the Commission’s Rules of Practice to demonstrate that its proposal is consistent with the requirements of the Exchange Act Section 6(b)(5), in particular the requirement that a national securities exchange’s rules be designed to prevent fraudulent and manipulative acts and practices,” the SEC wrote, as quoted by Coindesk.

Notably, the regulator insisted that the rejections “does not rest on an evaluation of whether bitcoin, or blockchain technology more generally, has utility or value as an innovation or an investment”.

In today’s trading, the Bitcoin price stood at $6,438.91, as of 12:5 BST. The digital coin has lost 3.6% in the past 24 hours, according to data from digital currency tracker Coinmarketcap.

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