US SEC Suspends ETNs For Bitcoin And Ethereum

The Ethereum and Bitcoin exchange-traded notes, which was designed as a way for traders to get into digital currencies in the US, have now been suspended by the United States SEcurities and Exchanges Commission (SEC). They were quoted for their reasons for the suspension of trading saying

“Confusion amongst market participants.”

These were the Ethereum Tracker one and Bitcoin Tracker One products, which were known as CXBTF and CETHF offered by Coin Shares Holdings. The suspension will go on for ten days which means it will finish on the 20th September. Unless the President of the United States himself approves an extension for a period of ninety calendar days, the suspension will only go on for a length of ten working days. In a statement released by the SEC, they said:

“The commission temporarily suspended trading in the securities CXBTF and CETHF because of confusion amongst market participants regarding these instruments.”

The SEC went onto say that no dealer or broker is able to enter into a quotation unless they have complied with the provisions set in the exchange act. They stated:

“If any broker or dealer enters any quotation which is in violation of the rule, the Commission will consider the need for prompt enforcement action.”

On 15th August, the ETN began with a pairing to USD, this allowed citizens of the United States to be able to trade with it. However, the Swedish NASDAQ has had it available for trading for three years, since 2015. An ETN is a security which is issued by a bank which underwrites it and therefore marks its place in the SEC jurisdiction. However, the product does have a expiry date and it backed by numerous assets held by the institutions offering the product. In this case, the assets in question are Ethereum and Bitcoin.