The US securities regulator raised a series of investor protection concerns about cryptocurrency mutual and exchange-traded funds, the strongest sign yet that the world\u2019s biggest market isn\u2019t likely to see the products any time soon.<\/p>\n
In a letter to two leading industry groups on Thursday, the Securities and Exchange Commission asked a series of questions on topics including the risks of manipulation, whether funds could accurately value the volatile products, and how they\u2019d meet demands to redeem virtual currency.<\/p>\n
It\u2019s hardly the welcome that cryptocurrency enthusiasts were hoping for. After Bitcoin futures started trading last month on CME Group Inc and Cboe Global Markets Inc exchanges, speculation grew that the SEC, which serves as a gatekeeper for individual investors in the US, would soon allow a range of crypto-ETF and mutual-fund offerings.<\/p>\n
\u201cThere are a number of significant investor protection issues that need to be examined before sponsors begin offering these funds to retail investors,\u201d Dalia Blass, who runs the regulator\u2019s investment management unit, said in the letter.<\/p>\n
Until the SEC\u2019s questions were answered, the agency didn\u2019t think it was \u201cappropriate for fund sponsors to initiate registration of funds that intend to invest substantially in cryptocurrency and related products,\u201d she said.<\/p>\n