Terra isn’t dead: the network is back up and running on a new blockchain, focusing on a more decentralized governance model. The community is making no attempts to revive its recently failed TerraUSD (UST) stablecoin. It has, however, re-launched a new version of the LUNA governance token, restarting its supply at 1,000,000,000 tokens. Here are the facts on the new blockchain, why it was launched, and the new token’s airdrop/ distribution. Background on Terra 2.0 Terra 2.0 (now known formally…
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SEC Refuses Ark 21Shares’ Bitcoin ETF Proposal
On Friday, the United States Securities Exchange Commission turned down Ark 21Shares’ Bitcoin ETF proposal. The commission’s refusal makes it its sixth rejection of crypto ETFs within the space of a year.
The SEC Cites its Reasons
On Friday, April 1, The United States Securities Exchange Commission (SEC) delivered its verdict on Ark 21Shares’ spot Bitcoin ETF proposal after several postponements. The SEC refused to approve the application, stating that the ETF did not provide adequate protection against manipulation or fraud. Thus, it could constitute a hazard to the financial security of potential investors.
The application was put forward on behalf of equities exchange titan, CBOE BZX Exchange by burgeoning crypto investment venture, 21Shares, and global asset manager, ARK Invest.
SEC and ETF Acceptance
The SEC’s strident relationship with ETFs continues with the latest rejection. This is despite the rise of crypto ETFs in the past year.
An exchange-traded fund (ETF) is a kind of investment security that tracks the prices of a particular commodity. Regardless of some key differences, ETFs can still be traded on exchanges the same way a regular stock can. Many consider crypto ETFs an easier option than a direct investment in any one token. The process of safely securing and storing cryptocurrency can become complex, however, individuals and organizations can choose an ETF alternative to automatically bypass this process.
Thus, the Ark 21Shares proposal is not the first of its kind. Several FinTech firms including Van Eck, One River Management, and NYDIG have also drafted up Bitcoin ETF proposals. However, the SEC appears to be hesitant about approving these ETFs, and has refused these applications for similar reasons.
With the SEC’s repeated and continued denial of spot cryptocurrency ETFs, some firms have begun to grow some restlessness. Michael Sonnenshein, CEO of major investment firm Grayscale, recently voiced intentions to take legal action if the SEC refuses Grayscale’s crypto ETF proposal.
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Despite recent happenings, cryptocurrency ETFs may become commonplace before the end of 2023. The SEC has announced a proposed rule change that would expand its jurisdiction to include crypto exchanges and certain decentralized finance systems.
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