US stock watchdog SEC rejects proposal for regulated bitcoin exchange

The US Securities and Exchange Commission SEC does not allow the Winklevoss brothers to set up a so-called bitcoin exchange traded fund. This would allow investors to buy bitcoins without creating a wallet for it.

According to the SEC, the price of the digital currency is too sensitive to fraud and manipulation. If the proposal had passed, it would most likely have led to a large increase in bitcoin investment. Now, in response to the decision, the value has actually dropped from around $1300 to around $1,050. Subsequently, the value partially recovered. Earlier this year, bitcoin broke established records, possibly in anticipation of setting up this exchange traded fund, or ETF.

The Winklevoss brothers, also known for their legal battle against Facebook, want to set up the exchange traded fund to make access to bitcoin easier. This in turn means that more money is being put into the digital currency and that it can become more attractive to the average citizen. The prices of this exchange would be tied to the bitcoin price. According to The New York Times, there are more applications to set up such exchanges, but it is unlikely that those applications will be approved. The newspaper also reports that the brothers are continuing their work to set up such an ETF. “We started working on this four years ago and we’re going to finish it,” they say. The two themselves would also have a large amount of bitcoins in their hands.