The Securities and Exchange Commission (SEC) has deemed recent applications for spot bitcoin exchange-traded funds (ETFs) filed by asset managers as inadequate.

Nasdaq and Cboe Global Markets, on behalf of asset managers like BlackRock (NYSE:BLK) and Fidelity Investments, received notification from the agency stating that the filings lacked clarity and comprehensiveness, The Wall Street Journal reported.

The announcement comes as the prices of bitcoin and other crypto-related stocks have experienced a surge following BlackRock's submission of ETF paperwork to the SEC.

Bitcoin (CRYPTO: BTC) has risen by approximately 20%, surpassing $30,000 for the first time since April.
Meanwhile, shares of Coinbase Global Inc (NASDAQ:COIN), listed as the custodian for the BlackRock fund's holdings, have surged by over 30% during the same period.

In response to BlackRock's move, several traditional and crypto asset managers, including Fidelity Investments, Ark Investment Management led by Cathie Wood, Invesco, WisdomTree, Bitwise Asset Management, and Valkyrie, have followed suit by reactivating or amending their applications for spot Bitcoin ETFs in recent days.

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However, the SEC has consistently rejected such funds since 2017 due to concerns of fraud and market manipulation. Several ETFs that hold Bitcoin futures are already available on the market.

BlackRock's bid for a spot Bitcoin ETF was viewed by investors and analysts as the most promising prospect thus far, given the company's impressive track record in successfully navigating the application process.

Some industry experts anticipated that BlackRock's filing would address the SEC's concerns by establishing a "surveillance-sharing agreement" with Nasdaq, the exchange that would list the ETF.

Nevertheless, the SEC informed the exchanges that it returned the filings due to the lack of naming the spot Bitcoin exchange with which a surveillance-sharing agreement is expected, as well as inadequate information about the specifics of these surveillance arrangements.

Asset managers have the option to revise the language and resubmit their applications.

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