In its Tuesday order denying the proposed rule change, the SEC said the exchange failed to show that its proposal was consistent with act requirements “that the rules of a national securities exchange be ‘designed to prevent fraudulent and manipulative acts and practices’ and ‘to protect investors and the public interest.'”
The order marked the second time the SEC shut down such a proposal related to the WisdomTree Bitcoin Trust, which a spokeswoman for WisdomTree Investments described as a spot bitcoin ETF. In December 2021, the regulator disapproved a proposed rule change to list and trade shares of the trust that the exchange had filed in March of that year.
“WisdomTree believes in the power of transparency and we only put out products that meet high regulatory, compliance and security frameworks as this will lead to success for investors,” Will Peck, head of digital assets at WisdomTree Investments, said in a statement provided via the spokeswoman.
WisdomTree realizes that regulatory concerns take time to address and appreciates the due diligence involved, the statement said.
“We acknowledge that this is a slow-moving process, and we aren’t letting that stop us from innovating in other ways in the meantime,” Mr. Peck’s statement said. “In the U.S. we are shifting the focus to identify new ways to provide retail access to crypto while also leveraging blockchain technology.”
For example, WisdomTree’s upcoming blockchain native app, WisdomTree Prime, will allow the firm to offer blockchain-enabled financial services, including crypto access outside of the exchange-traded-product wrapper, he said.
WisdomTree also recently received SEC approval for its first digital fund, the WisdomTree Short-Term Treasury Digital Fund following “years of regulatory engagement,” Mr. Peck said. He added that the SEC’s signoff on that fund is “a proof point that demonstrates our dedication to working with regulators to become a first mover in the blockchain space while maintaining our reputation grounded in security, trust, and reliability.”
The WisdomTree spokeswoman declined to comment on whether the proposal regarding the WisdomTree Bitcoin Trust might be refiled.
WisdomTree currently has about $72 billion in assets under management globally.
