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NEW YORK (Reuters) – The U.S. Securities and Exchange Commission said on Sunday it was immediately suspending trading in two investment products that track cryptocurrencies, citing confusion in the markets over whether the products are exchange-traded funds (ETFs).
FILE PHOTO – High-end graphic cards are installed in a cryptocurrency mining computer at a computer mall in Hong Kong, China January 29, 2018. REUTERS/Bobby Yip/File Photo
The SEC said in a statement that trading in Bitcoin Tracker One CXBTF.PQ CXBTF.PK and Ether Tracker One CETHF.PQ CETHF.PK will be halted in the United States until at least Sept. 20.
The products promise to track the price of the cryptocurrencies, less fees. They are both listed on a Nasdaq Inc (NDAQ.O) exchange in Stockholm, Sweden, but trade “over the counter” in transactions that occur off exchanges within the United States.
“It appears … that there is a lack of current, consistent and accurate information,” the SEC said in a notice posted on its website. “Application materials submitted to enable the offer and sale of these financial products in the United States, as well as certain trading websites, characterize them as ‘Exchange Traded Funds.’”
The issuer of Bitcoin Tracker One and Ether Tracker One, XBT Provider AB SE0010296574.ST and its parent company, did not immediately respond to emailed requests for comment. Nasdaq also did not immediately respond for comment.
The SEC has taken a strict stance against letting ETFs tracking bitcoin and other cryptocurrencies come to market.
But investment firms have been pushing other types of investments that attempt to make it as easy to trade cryptocurrencies as a regular stock.
Those products are sometimes called ETFs, but that term generally refers to a different and often more stringently regulated product. Some industry experts, including the largest ETF provider BlackRock Inc (BLK.N), have called for regulators to standardize the terms used to describe ETFs and other kinds of investment products.
Virtual currency, including bitcoin and ether, can be used to move money around the world quickly and with relative anonymity, without the need for a central authority, such as a bank or government. A fund holding the currency could attract more investors and push its price higher.
Reporting by Trevor Hunnicutt; Editing by Peter Cooney and Will Dunham
HONG KONG (Reuters) – Chinese video-streaming firm Leshi Internet Information & Technology said it expects a net loss of 11.6 billion yuan ($ 1.83 billion) for 2017, citing a cash crunch at embattled technology conglomerate LeEco that hurt its revenues.
Leshi had reported a profit of 554.8 million yuan in 2016.
It was once the main listed unit of LeEco which was founded by Jia Yueting. Last year, property developer Sunac China became Leshi’s second-largest shareholder and Jia subsequently resigned as chairman and CEO from the company but remains its largest shareholder.
Leshi is trying to recover debt owed by Jia. It said last week it is seeking equity stakes in the car businesses of Jia for debt owed by him and his companies amounting to as much as 7.5 billion yuan ($ 1.17 billion).
Leshi flagged the expected loss for 2017 in a statement to the Shenzhen stock exchange on Tuesday evening.
The announcement sent Leshi’s shares plunging by the daily limit of 10 percent on Wednesday, the sixth consecutive day they have tumbled the maximum allowed since resuming trading a week ago following a 9-month suspension.
(This version of the story corrects fifth paragraph to show announcement was made to Shenzhen stock exchange, not Hong Kong stock exchange)
Reporting by Sijia Jiang; Editing by Anne Marie Roantree and Muralikumar Anantharaman