Cryptocurrencies slumped on Wednesday, with bitcoin tumbling below US$6 500 for the first time since July, after the US Securities and Exchange Commission postponed a decision on whether to allow the listing of an exchange-traded fund backed by the largest digital currency.
Bitcoin retreated as much as 6.1% to $6 457 at 12.43pm in Hong Kong, the lowest since 16 July, according to consolidated Bloomberg pricing. Rival tokens also fell, with ripple slumping almost 10% while ether and litecoin sank at least 3.1%, the data shows.
The SEC now has until 30 September to “approve or disapprove, or institute proceedings to determine whether to disapprove” a proposed rule change from Cboe Global Markets that would allow the listing of a fund from VanEck Associates and SolidX Partners to list, the regulator said in a statement. An initial deadline was due to expire next week.
Last month’s rally in bitcoin to back above $8 000 on optimism for approval of bitcoin-backed ETFs and indications of wider interest in digital currencies at mainstream financial institutions such as BlackRock has all but evaporated, with the largest cryptocurrency now down more than 20% from its most recent high on 24 July.
The SEC denied a request to list a bitcoin ETF run by the Winklevoss twins at the end of July, while a massive wrong-way bet on Bitcoin at Hong Kong-based exchange OKEx that burned counter-parties dealt a fresh blow to confidence in digital currency trading platforms. — Reported by Eric Lam, (c) 2018 Bloomberg LP