The Wall Street Journal Editorial Board has come out swinging towards Gary Gensler’s “legendary” resistance to approving a spot Bitcoin exchange-traded fund (ETF).
The hard-hitting opinion piece, revealed on Wednesday, July 6 referred to as out the Gensler-led Securities and Exchange Commission (SEC) for overt inconsistencies in how the fee handles functions for Bitcoin-related exchange-traded merchandise (ETPs) in comparison with extra conventional property and different commodities.
So far, Gensler’s SEC has rejected each proposal for a spot Bitcoin ETP, together with two within the final week from Grayscale and Bitwise, which resulted in Grayscale launching authorized motion towards the SEC.
These constant rejections led SEC Commissioner Hester Peirce to declare Gensler’s resistance to identify crypto ETPs as “becoming legendary”, because the fee has already authorized a number of ETPs for Bitcoin futures, which come at a lot increased prices and embrace a lot larger threat for traders than the proposed spot ETPs.
Peirce additionally questioned why ETPs haven’t been authorized within the United States regardless of the merchandise having carried out so elsewhere.
“At what point, if any, does the increasing maturity of the Bitcoin spot markets and the success of similar products elsewhere tip the scale in favor of approval?”
The editorial board has additionally drawn consideration to a two-pronged method employed by Gensler which makes it virtually unimaginable to get a spot Bitcoin product authorized.
This consists of requiring ETP sponsors to show {that a} vital quantity of Bitcoin buying and selling happens on a regulated market, or that the underlying market should “possess a unique resistance to manipulation beyond the protections…of traditional markets.”
According to the WSJ, Gensler is “fully aware” that the primary standards merely can’t be met as a result of nearly all Bitcoin buying and selling at the moment happens on unregulated crypto exchanges.
The second criterion can be extraordinarily troublesome for sponsors to satisfy because the SEC has “arbitrarily established” the next customary for spot Bitcoin ETPs with out “explaining how to satisfy it.”
Related: The US Dept. of Commerce has 17 questions to assist develop a crypto framework
Eric Balchunas, a senior ETF analyst at Bloomberg instructed his 107,000 Twitter followers that it was “nice to see” the WSJ echo related ideas to his ETF analyst colleague James Seyffart — claiming that Gensler is “holding innovation hostage” to take management of the crypto market.
Nice to see the @WSJ editorial board right this moment echo @JSeyff’s be aware from April that Gensler is holding spot bitcoin ETFs (and innovation) hostage so he can get management of crypto market h/t @ToddRosenbluth pic.twitter.com/wUEr7AdnpU
— Eric Balchunas (@EricBalchunas) July 7, 2022
The piece comes one week after Grayscale launched authorized motion towards the SEC for denying its software to launch a spot Bitcoin ETF — claiming that the SEC’s inconsistent guidelines regarding spot and futures Bitcoin ETPs contradict the regulation’s requirement that regulators apply “consistent treatment to similar investment vehicles.”
