One River’s Carbon Neutral Bitcoin ETF Rejected by SEC

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The One River Carbon Neutral Bitcoin Trust – a spot bitcoin exchange-traded fund (ETF) proposed by One River Asset Management – has been rejected by the U.S. Securities and Exchange Commission (SEC).

• The proposal to list on the NYSE Arca exchange lacks sufficient investor protections, the SEC said, which is similar verbiage used by the agency in denying other spot bitcoin (BTC) ETFs.

• One River submitted paperwork for the ETF in May 2021, and the SEC in March announced a delay in its decision. This particular spot ETF application differed from others in that One River pledged to buy and dispose of carbon credits to account for the emissions associated with the bitcoin in the fund.

• While the SEC has green-lit a number of futures-based bitcoin ETFs, it has denied (or otherwise delayed) all spot bitcoin ETFs brought before it. To name two, the agency in March denied applications submitted by NYDIG and GlobalX.

• The most recent futures-based bitcoin ETF to win SEC approval was one from Valkyrie. That asset manager had filed its application under the Securities Exchange Act of 1934. Other approved bitcoin futures ETFs came under the Investment Company Act of 1940. The Valkyrie "34 Act" approval had given some hope to spot bitcoin ETF advocates.

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