Third Time the Charm for a Spot Bitcoin ETF? Cboe Tries Again To Find Out

Cboe Global Markets filed a proposal to list and trade shares of a spot bitcoin exchange-traded fund, marking the third time the firm has tried to get US regulatory approval. 

Cboe BZX Exchange, operated by Cboe, officially filed with the Securities and Exchange Commission on Tuesday to list and trade those shares of the ARK 21Shares Bitcoin ETF. 

Cboe tried in both May 2022 and August 2021 to list and trade ARK 21Shares Bitcoin ETF. 

The SEC has repeatedly had concerns about fraud and manipulation in those denials as well as other rejections in the past.

An ongoing battle 

The SEC has not yet approved of a spot bitcoin ETF. 

The agency approved several bitcoin futures ETFs when it allowed the trading of the ProShares Bitcoin Strategy ETF in October 2021. 

The approval of a bitcoin futures ETF and not a spot bitcoin ETF has been specifically a point of contention amid a lawsuit brought against the SEC by crypto asset management company Grayscale.

Grayscale has been trying to convert its flagship Grayscale Bitcoin trust fund into a spot bitcoin ETF for years. 

In its brief, Grayscale argued that the spot price of bitcoin in both spot and futures ETFs is subject to the same risks, and so it does not make sense to approve one product and not the other.

In March, oral arguments were heard by the D.C. Circuit Court of Appeals. 

Former U.S. Solicitor General Don Verrilli, who is representing Grayscale, argued in court that the SEC’s disapproval of Grayscale’s spot bitcoin ETF contradicts previous orders.  

Other denials 

Dozens of other proposals have been denied by the SEC for years.
 

A proposal from Cameron and Tyler Winklevoss to list and trade shares of the Winklevoss bitcoin trust was posted in July 2016.
 

That spot bitcoin ETF has been rejected multiple times.