Bitcoin fell sharply on Wednesday after the U.S. Securities and Exchange Commission (SEC) delayed a decision on a proposed bitcoin exchange-traded fund (ETF), which would have been the first financial product of its kind.
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Cryptocurrency markets fell as a result. Bitcoin was down around 8 percent from 24 hours ago at 10.53 a.m. London time, trading at just over $6,500, according to data from CoinDesk. It’s value had fallen over $9 billion.
Investment firm VanEck teamed up with Solid X, a financial service company, earlier this year in a bid to launch an ETF that is backed by actual bitcoins rather than futures. An ETF is a financial product that tracks the price of an asset and is listed on an exchange. It means that investors don’t actually have to buy the underlying asset.
ETF’s are seen as a way for institutional investors to get into cryptocurrency investing in a safer way than buying bitcoin on a crypto-asset exchange.
This is VanEck’s third attempt to push a bitcoin ETF through, having been rejected by the SEC twice previously. On this occasion, the SEC said that it is pushing out its decision until September 30.
Bitcoin, which is the world’s largest cryptocurrency by market capitalization or value, has fallen dramatically from the the near-$20,000 record high it hit in December 2017. But bitcoin has recovered from June, when it fell below $6,000. And interest in the virtual currency appears to have increased. Bitcoin’s share of the entire cryptocurrency market is at its highest level this year and near where it was when the digital coin hit its highest price level in history.
There are a number of applications underway to get a bitcoin ETF listed, but so far none have been approved by the SEC. A second attempt by Cameron and Tyler Winklevoss, founders of crypto exchange Gemini, to list their ETF was recently rejected by the SEC.