SEC Solicits Public Input on CBOE’s ‘Game-Changing’ Proposals

The US Securities and Exchange Commission (SEC) has released notices on two different occasions as the agency’s way of asking public comment concerning possible rule changes.

Said notices stemmed from Chicago Board Options Exchange (CBOE) proposal top exempt its proposed Bitcoin-focused ETFs from particular market manipulation rule.

In December 2017, CBOE Global Markets has requested for SEC’s green light to list six Bitcoin-focused exchange-traded funds (ETFs). The two notices were published just five days apart – one on December 28  and the other on January 2, 2018.

The six ETFs are First Trust Bitcoin Strategy, First Trust Inverse Bitcoin Strategy, REX Bitcoin Strategy, REX  Short Bitcoin Strategy ETF, GraniteShares Bitcoin ETF, and GraniteShares Short Bitcoin ETF.

The inclusion of Bitcoin in the trading platforms changes the entire ‘game’ of trading. Under the regular circumstances, the advisors to a firm in charge of managing funds should establish a wall between them and the dealers they wish to get affiliated with. This way, the company portfolio would remain confidential as both advisors and brokers will not be able to exchange information.

However, Cboe strongly believes that such rule cannot be applied to Bitcoin futures. This is because Bitcoin cannot be considered a commodity that can be manipulated since ‘manipulation’ itself would mean having to influence the general Blockchain across the globe.

In addition, Cboe believes that it is unlikely for an individual to have an insider knowledge on Bitcoin futures given the nature of the cryptocurrency network as a whole. Cboe stresses out the reasons for exemption in two different filings submitted on December 15 and December 19, 2017.