The United States Securities and Exchange Commission has once again rejected a proposal to list the ARK 21 Shares Bitcoin ETF on equities exchange Cboe BZX, according to Jan. 26 statement from the SEC, which rejected a similar proposal in April.

The proposed exchange-traded fund would have been managed jointly by Cathie Wood’s ARK Investment Management and 21Shares if it had been approved. The purpose of the proposed fund was to allow investors to gain exposure to Bitcoin’s price within the confines of the regulated stock market.

The Cboe BZX Exchange had originally asked to list the ETF in June 2021. After the first application was rejected in 2022, it reapplied and made new legal arguments in an attempt to get the fund approved.

In its second application back in May, the Cboe BZX Equities Exchange argued that it has a “comprehensive surveillance-sharing agreement with a regulated market of significant size” that can prevent manipulation of prices. The ARK 21Shares Bitcoin ETF should therefore be allowed to be listed, the exchange argued. According to the application, this surveillance sharing agreement is with the Chicago Mercantile Exchange (CME), where Bitcoin futures contracts are traded.

The application also argued that most currency and commodity spot markets are unregulated, but this does not usually mean that an application will be rejected for that reason alone.

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In its response, the SEC rejected these arguments. It stated that the surveillance sharing agreement between Cboe BZX Equities Exchange and the CME does not apply to spot Bitcoin, since only Bitcoin futures contracts are traded at CME.

The SEC also claimed that having a surveillance sharing agreement is not always necessary, but if such an agreement does not exist, then the exchange must “establish that other means to prevent fraudulent and manipulative acts and practices will be sufficient.” It said that the exchange has not demonstrated this point, so it is not allowing the ETF to be listed.

The SEC has so far not approved any spot Bitcoin ETF to be listed on an exchange. Grayscale Investment Trust is seeking to convert its Bitcoin Trust into a spot Bitcoin ETF, and it has sued the SEC for rejecting its proposal. Oral arguments are scheduled to be heard for the Grayscale case in March.