A highly touted investment instrument that sought to appeal to U.S. public markets investors looking for cryptocurrency exposure has just seen a setback.
Announced on Sunday, the U.S. Securities and Exchange Commission (SEC) has issued an order seeking to suspend the trading of the Bitcoin Tracker One and Ether Tracker One exchange-traded notes, issued by XBT Provider AB, a Swedish-based subsidiary of the U.K. firm CoinShares Holdings.
In the official order, the SEC cited a âconfusion amongst market participantsâ based in the U.S. as to the nature of the financial instruments as the reason for the move.
The suspension is in effect as of 5:30 p.m. EDT today, and will last through 11:59 p.m. EDT on September 20. Further, trading on other, non-U.S. exchanges will not be interrupted during the suspension, the release suggested.
âThe broker-dealer application materials submitted to enable the offer and sale of these financial products in the U.S., as well as certain trading websites, characterize them as âExchange Traded Funds.â Other public sources characterize the instruments as âExchange Traded Notes.â By contrast, the issuer characterizes them in its offering materials as ânon-equity linked certificates,'â the release reads.
The SEC went on to say that the decision was in âthe public interestâ and that it was line with its mandate to ensure the âprotection of investors.â
The news comes nearly a month after the products, live on the Nasdaq Stockholm exchange since 2015, made a move to court U.S. investors, announcing that they would be quoted in U.S. dollars starting August 15.
Billed as a âsoft openingâ for public markets crypto trading in press coverage by Bloomberg, the products were contrasted with more sophisticated exchange-traded fund (ETF) products which had recently been shot down by regulators and described as a more immediate way to access crypto exposure with dollars.
âEveryone thatâs investing in dollars can now get exposure to these products, whereas before, they were only available in euros or Swedish krona,â Ryan Radloff, the chief executive officer at CoinShares Holdings said at the time.
Representatives from CoinShares Holdings declined to provide comment when reached.
SEC image via Shutterstock
