Wall Street's top regulator has once again struck down an attempt from Tyler and Cameron Winklevoss to list a bitcoin exchange-traded fund.

On July 26, the SEC disapproved a proposal from Cboe Global Markets Inc.-owned Bats BZX Exchange Inc. that would have allowed the exchange to list and facilitate trading of Winklevoss Bitcoin Trust, an ETF based on the value of bitcoin. The agency rejected the proposal over concerns about the level of market surveillance.

The SEC originally rejected the Winklevoss brothers' proposal in 2017 over similar market surveillance-related concerns. The agency eventually agreed to review the decision, but ultimately decided that it did not support the proposal. The Winklevoss brothers are the co-founders of cryptocurrency exchange company Gemini Trust Co. LLC.

The SEC has yet to approve a bitcoin ETF, despite growing institutional interest in the cryptocurrency space.

In January, the SEC expressed concerns over cryptocurrency-based funds, particularly calling out how such investment products would be valued, whether adequate liquidity would exist and if retail investors would be appropriately protected from market manipulation.

Hester Peirce, one of the SEC's newest commissioners, dissented from the commission's ruling, writing that the SEC should have allowed Cboe's exchange to list and trade the bitcoin ETF. Peirce, a Republican, also expressed worries that the SEC's approach to the bitcoin market has thus far prevented "greater institutionalization."

"More institutional participation would ameliorate many of the commission's concerns with the bitcoin market that underlie its disapproval order," Peirce wrote. "More generally, the commission's interpretation and application of the statutory standard sends a strong signal that innovation is unwelcome in our markets, a signal that may have effects far beyond the fate of bitcoin [exchange-traded products]."