The United States Securities and Exchange Commission (SEC) has halted trading of the first and only Bitcoin exchange-traded note (ETN) available in the United States. The ETN Bitcoin Tracker One, under the symbol CXBTF, had only been trading in the United States since mid-August 2018.

The SEC says the halting of the Bitcoin Tracker One ETN is only temporary until 20 September, but from the wording, it sounds like it will be prohibiting the ETN long term. The SEC gives broker-dealers permission to interact with CXBTF only if they are helping to liquidate positions of US investors.

The SEC says there is a lack of current, consistent, and accurate information about Bitcoin Tracker One that is confusing investors. Particularly, Bitcoin Tracker One is characterized as an ETN by public sources, an exchange-traded fund (ETF) in some application materials, and the issuer classifies it as a non-equity linked certificate. The SEC says due to this classification confusion that it must be halted to protect investors.

It was a major milestone that Bitcoin Tracker One had become available in the United States. It allowed traders to invest in Bitcoin in a safe and regulated way, and had the potential to be listed on all the major stock trading platforms, which would have increased institutional investment. Indeed, Fidelity had already started facilitating the buying and selling of Bitcoin Tracker One.

The SEC has taken an aggressively negative stance towards Bitcoin, rejecting well over a dozen Bitcoin ETF applications. One of the SEC commissioners, Hester Pierce, says the SEC is not doing its job by getting in the way of a Bitcoin ETF. Pierce thinks a Bitcoin ETF would make it safer for investors to buy Bitcoin, and by rejecting ETFs the SEC is exposing investors to risk, the opposite of what they should be doing.

The SEC has repeatedly said that the entire Bitcoin market is too risky and unregulated, and that’s the reason no ETF is being accepted. In the case of Bitcoin Tracker One, the SEC chose a small legal detail, the particular classification, to halt trading.

Considering the SEC’s track record, it is clear that they will make sure there is no regulated Bitcoin securities product available to US investors for the foreseeable future. Bitcoin Tracker One is an ETN backed by actual Bitcoins that allowed institutional investors to buy Bitcoin on major stock trading platforms, and that is not in the SEC’s game plan.


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