The Chicago Board Options Exchange (CBOE) has sent a letter to the US Securities and Exchanges Commission (SEC) and asked it not to take a stand against Bitcoin- and cryptocurrency-related exchange-traded funds (ETFs) given that they are quite the same as regular ETFs, which track commodities.
Early this year, the SEC said that opening the door for Bitcoin ETFs should be preceded by addressing “significant investor protection issues.” The regulator was concerned about how the ETFs would be priced, stored, and protected.
Cboe’s letter, which was signed by company president Chris Concannon, noted that “the vast majority of these concerns can be addressed within the existing framework for commodity-related funds related to valuation, liquidity, custody, arbitrage, and manipulation.”
The exchange operator is confident that ETFs would provide investors with a more convenient and transparent way of trading cryptocurrencies than the spot market approach.
However, the SEC is not on the same wavelength as Cboe. The regulator is concerned about the high volatility of Bitcoin and cryptocurrency prices, the recent hacker attacks on crypto exchanges, and the lack of concordance among governments regarding cryptocurrencies. The SEC has already rejected dozens of proposals for ETFs, including Cboe application to launch several such funds.
Cboe suggested in its letter the regulator should assess each crypto fund separately, examining the products on a case-by-case basis.
The exchange operator noted that the Bitcoin and crypto markets were liquid enough to support related funds.
“As the volumes continue to grow, especially on regulated US markets, the overall spot bitcoin market looks more and more like a traditional commodity market and Cboe continues to believe that the spot market is sufficiently liquid to support a bitcoin ETP [exchange-traded product].”
In December, Cboe successfully launched Bitcoin futures contracts, but they are regulated by the Commodity Futures Trading Commission.
This article appeared first on Cryptovest
