(Bloomberg) -- The U.S. securities regulator raised aseries of investor protection concerns about cryptocurrency mutual and exchange-tradedfunds, the strongest sign yet that the world’s biggest market isn’tlikely to see the products any time soon.

In a letter to two leading industry groups on Thursday, theSecurities and Exchange Commission asked a number of questions ontopics including the risks of manipulation, whether funds couldaccurately value the volatile products, and how they’d meet demandsto redeem virtual currency.

It’s hardly the welcome that cryptocurrency enthusiasts werehoping for.

After Bitcoin futures started trading last month onCME Group Inc. and Cboe Global Markets Inc. exchanges, speculationgrew that the SEC, which serves as a gatekeeper for individualinvestors in the U.S., would soon allow a range of crypto-ETF andmutual-fund offerings.

“There are a number of significant investor protection issuesthat need to be examined before sponsors begin offering these fundsto retail investors,” Dalia Blass, who runs the regulator’sinvestment management unit, said in the letter.

Until the SEC’s questions were answered, the agency didn’t thinkit was “appropriate for fund sponsors to initiate registration offunds that intend to invest substantially in cryptocurrency andrelated products,” she said.

Last week, several fund companies were told by the SEC to pulltheir registrations after the regulator’s staff said it was worriedabout protecting investors, people familiar with the matter said atthe time.

The agency has slammed the brakes on at least a dozen proposedbitcoin ETFs and two cryptocurrency mutual funds that had tried touse a fast-tracked process to list the products.

In March, the SEC rejected a proposal to list an ETF backed bythe Winklevoss twins, Tyler and Cameron, who are foundersof bitcoin exchange Gemini. At the time, the regulator raisedconcerns that exchanges wouldn’t be able to conduct adequatesurveillance of the underlying market.

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