Congress Writes to SEC Chair Urging Approval of Spot Bitcoin ETF

The spot Bitcoin exchange-traded funds (ETFs) remained under tight scrutiny of US regulators as the crypto industry still awaits one. There were a number of filings with the SEC regarding spot ETF, but the agency is yet to approve one. The approval of the product stuck for quite some time, so it attracted the attention of lawmakers and some Congress members called out the financial regulator to approve spot ETF applications.  

Some Congress members in the United States have sent a letter to the Securities and Exchange (SEC) chair Gary Gensler. The letter sent on September 26, noted the request seeking immediate approval of spot Bitcoin ETFs listings. 

Representatives including Mike Flood, Ritchie Toorres, Wiley Nickel, and Tom Emmer came forward to sign the letter in favor of the Bitcoin ETF. In the letter, the Congress members were seen arguing that in a regulated environment, a spot bitcoin exchange-traded fund (ETF) is likely to enhance “investor protection.” It would provide safe and transparent exposure to Bitcoin investments for investors. 

Congress is responsible for ensuring SEC’s proceedings in the direction of approving investment products that meet the stated requirements, the letter added. The agency seems to have no reason to frequently reject the spot Bitcoin ETF applications “under inconsistent and discriminatory standards.” 

Lawmakers Cited Court Decision Against the SEC

The lawmakers also cited the U.S. court’s decision against the agency and in favor of a crypto firm over the issue of Bitcoin ETF. 

The United States Court of Appeals for the District of Columbia Circuit ruled in favor of Grayscale, managing firm of the biggest Bitcoin (BTC) fund GBTC. The firm filed a lawsuit against the SEC following the agency rejecting Grayscale’s application to convert its Bitcoin fund into an ETF. 

SEC argued that since Bitcoin markets are “resistant to manipulation” so they are not ready to be presented for ETF proposals hence it can not be approved. However, the court did not buy the argument and ruled that the claim of the financial regulator was unable to justify the decision of outright rejecting the proposal of Bitcoin ETF from Grayscale. 

Companies Awaiting Spot Bitcoin ETFs

The spot Bitcoin ETFs are one of the highly anticipated investment vehicles in the crypto industry. The financial products are popular in the traditional finance sector. Though the crypto industry has futures Bitcoin ETFs, it is yet to see a spot BTC fund. 

Despite no success in the past years in terms of spot Bitcoin ETF approval, many traditional finance giants stepped in with the filing. It includes BlackRock, Fidelity Investments, VanEck, WisdomTree, Invesco, and several others. 

Nancy J. Allen is a crypto enthusiast and believes that cryptocurrencies inspire people to be their own banks and step aside from traditional monetary exchange systems. She is also intrigued by blockchain technology and its functioning.

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