However much it was anticipated, this week’s decision from the US Securities and Exchange Commission (SEC) did Bitcoin and its brethren no favors.

Nine Bitcoin-backed exchange traded funds were submitted for approval to the regulatory body, which predictably declined their applications.

Bitcoin and crypto-currencies reacted instantly as markets tumbled by over $US10 billion in a couple of hours. The news was not unexpected since the SEC had already rejected a number of high profile Bitcoin ETF proposals in previous weeks. In total nine applications from ProShares, Direxion, and GraniteShares were rejected. Proshares and Direxion were seeking a listing on NYSE Arca, while GraniteShares wanted a place on the CBOE’s list of publicly-tradable assets.

In a formal statement the SEC said it was “disapproving this proposed rule change because, as discussed below, the Exchange has not met its burden under the Exchange Act and the Commission’s Rules of Practice to demonstrate that its proposal is consistent with the requirements of the Exchange Act Section 6(b)(5), in particular the requirement that a national securities exchange’s rules be designed to prevent fraudulent and manipulative acts and practices.”

The statement, which has been used in previous disapprovals, shows that the SEC still believes that Bitcoin markets are subject to manipulation on a large scale. It also cited market size as another reason for rejection; “Among other things, the Exchange has offered no evidence to demonstrate that bitcoin futures markets are “markets of significant size.”

Decisions on previous proposals such as the VanEck and SolidX ETF have been delayed until September. While many anticipate SEC approvals not to be forthcoming until early 2019, this does not explain why markets have reacted so adversely several times this month.

Bitcoin reacted instantly to the announcement, plunging over $200 in a matter of minutes according to analytics website coinmarketcap.com. It has currently recovered a little and is trading at $6,440, still down 3.5% on the day. Other crypto-currencies such as Ethereum, XRP and Bitcoin Cash lost even more as markets followed Bitcoin’s drop.

The outlook is still very bearish as the total crypto-currency market has declined over 70% in 2018 losing over $600 billion in capitalization. Industry analysts and technologists, however, are still bullish on crypto, viewing these wild swings in price as perfectly normal in the nascent ecosystem.