Bitcoin ETF Approval Has Failed Investors, Says Bloomberg + More Crypto News
Get your daily, bite-sized digest of blockchain and crypto news – investigating the stories flying under the radar of today’s news.
In this edition:
__________
“The fact is, cryptocurrency markets are a mess,” and the US Securities and Exchange Commission (SEC) Chair Gary Gensler has failed investors by approving spot Bitcoin (BTC) exchange-traded funds (ETFs), the Bloomberg Editorial Board argued on Wednesday.
Per the authors,
“The SEC should have tried harder to reform the unregulated spot trading markets.”
After approving the new ETFs, Gensler warned investors to “remain cautious about the myriad risks associated with bitcoin and products whose value is tied to crypto.”
But at the same time, the approval suggested to investors that “the SEC is comfortable with a new asset class that more than doubled in value last year and that’s sure to be aggressively marketed to them as a sexy alternative to stocks and bonds and mutual funds,” the authors said, adding:
“[Gensler] could have served them better.”
The SEC’s decision in 2021 to approve ETFs based on Bitcoin futures boxed it in, they argued. They may have appeared safer, as they trade on the CME Group’s regulated futures exchange. But they derive their value from spot prices established on crypto exchanges.
This is why a US Court of Appeals overturned the regulator’s denial of a spot Bitcoin ETF application.
“Even so, Gensler should’ve tried to use this opportunity to force some investor protections on the spot trading platforms,” the editors said.
The SEC could’ve made approval conditional on the ETFs deriving prices from platforms that meet the standards of regulated securities exchanges.
That way, “for all their resistance to regulation,” trading platforms would have had an
Read more on cryptonews.com
