© Reuters.
NEW YORK – BitGo CEO Mike Belshe expressed skepticism that the Securities and Exchange Commission (SEC) is likely to approve bitcoin exchange-traded funds (ETFs), citing concerns about market structure and potential handling. In a recent interview, Mr. Belshe highlighted the lack of separation between exchange services and custody functions, specifically referring to Coinbase’s (NASDAQ:) role as a custodian.
The cryptocurrency industry is closely monitoring regulatory developments, especially in light of recent events such as the collapse of FTX and the subsequent legal troubles of its founder, Sam Bankman-Fried. followed. The SEC has been extra vigilant in its efforts to protect investors, including delaying review of new ETF applications like Hashdex’s spot ETF.
Despite a general sense of optimism among industry analysts who expect a favorable decision in January, Mr. Belshe’s comments reflect a more cautious outlook. He highlighted that major financial entities continue to choose Coinbase Custody for their ETFs, a strategy mirrored by FTX before its fall. This approach has come under scrutiny from regulators, who seek to prevent market manipulation.
The backdrop to these discussions includes BlackRock’s (NYSE:) ETF request in June, which was met by a surge in the value of BTC, reaching $36,200 as reported by TradingView. However, the SEC’s commitment to rigorous oversight suggests that other Bitcoin ETF applications could be rejected due to unresolved issues regarding market structure and investor safety.
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