Cryptocurrency enthusiasts have been eagerly awaiting the approval of what would be the first-ever bitcoin exchange-traded fund, or ETF.
But the man largely behind greenlighting one — Securities and Exchange Commission Chairman Jay Clayton — has a few worries that need to be assuaged before he's "comfortable" approving the investment vehicle.
The first is a lack of market surveillance.
Because most cryptocurrency exchanges don't use the same monitoring tools as stock exchanges, Clayton said investors may not get a fair assessment of bitcoin's price.
"What investors expect is that trading in the commodity that underlies that ETF makes sense and is free from the risk of manipulation," Clayton said at the Consensus Invest Conference in Manhattan. "It's an issue that needs to be addressed before I would be comfortable."
The New York Stock Exchange and the Nasdaq have what's known as "surveillance," or systems that monitor, prevent and investigate abusive and manipulative activity on the exchanges.