Yes but no ! The official adoption of Bitcoin by traditional finance is undoubtedly a historical fact. And the recent U.S. SEC Approval of Cash ETFs alone marks this tipping point. Some see it as a major breakthrough for the cryptocurrency sector, while others speak of a loss of identity underway. But there is no need to worry, because in the camp of the US regulator nothing has changed. Indeed, Gary Gensler remains firmly opposed to these new crypto financial options. And the Regulatory Best Interest (Reg BI) enacted in 2019 could well allow it to spoil the party.
Gary Gensler has given in, but he won’t admit defeat
If ridicule held regulators accountable, the U.S. Securities and Exchange Commission (SEC) would be in a bad place. Because his boss Gary Gensler voluntarily swims against the current when it comes to cryptocurrencies. An activity that he operates with the pride of someone who thinks it makes sense.
Indeed, Gary Gensler was finally forced by a Court of Appeal (DC Circuit Court) to adopt spot Bitcoin ETFs, because he had already done the same for their term (future) versions. And this must not happen, for this little guy whose vision of power seems to boil down to preventing it in order to show that it is there.
Barely has this historic stage begun, the head of the SEC rushed to spoil the party. And the problem seems to be its (still) effective nuisance capacity, even after approving these ETFs. Indeed, Gary Gensler kept an ace up his sleeve. This in the form of a set of new rules – Regulatory Best Interest (Reg BI) – adopted in 2019.
A legal framework that allows the regulator to attack investment advisors. Because the latter must, obviously, carry out due diligence before encouraging their clients to invest funds. But the door remains wide open on the latter’s ability to sue their advisors in the event of unsatisfactory results.
Just imagine what it could be used for this regulatory weapon in the hands of a vengeful Gary Gensler on the ETF issue Bitcoin in cash…
Ethereum ETF postponed to March
Because nothing is won yet in this matter of spot crypto ETFs. Just see how Gary Gensler takes the path of the same slow strategy about the version Ethereum. All according to the logic of taking your time to make everyone lose it.
“The Commission considers it appropriate to set a longer deadline for taking action on the proposed rule change to provide sufficient time to consider the issues raised. »
DRY
Yet, the situation is exactly the same as for Bitcoin. In fact, the company Fidelity already indicated last November in its application file that the SEC could not object to its Ethereum spot ETF, since it already authorized their versions in the long term. Same scenario, new episodes…
“The fact that they allowed futures-based ETFs to be listed is enough to say that they think about ether the same way they think about bitcoin and you can infer that they probably think that it is not a financial security. »
Stuart Barton, co-founder of Volatility Shares
The SEC therefore still seems determined to putting obstacles in the way of spot crypto ETFs. A position firmly maintained by the head of the SEC, in the process of flirting with unprecedented ridicule in the field. But clearly, preventing is far more important than maintaining any credibility.