Though the crypto community has been praising Gary Gensler, Chairman of Securities & Exchange Commission (SEC) for granting permission to Bitcoin based exchange-traded fund (ETF) yet he feels that the decision requires a clarification. He therefore enlightens the general public why, being the Chairman of SEC, he decided to approve Proshares’s application for establishing a Bitcoin ETF.
There has been a debut in the US digital asset industry as the first of its kind Bitcoin-based ETF has been approved. The sanction of course has come from the Securities & Exchange Commission’s Chairman, Gary Gansler.
It was quite some time that SEC was holding onto the applications aiming towards digital currency-based ETFs. However, it is only now that SEC has finally sanctioned the ETF and the first entity to launch Bitcoin ETF is “Proshares”. Next in line company, which is awaiting to launch Bitcoin ETF, is the world’s biggest digital asset management company called “Grayscale Investments”. This very asset manager company wants to convert its existing Bitcoin fund into an ETF fund. For this purpose, necessary filing is due to be filed by Grayscale before the SEC.
Certainly, there has been an opening of a door at the SEC in which an entirely new type of crypto service has been permitted. The decision of SEC has brought laurels for the SEC as well as for its Chairman, Gary Gensler. But most of the crypto community members are still wondering what made SEC to make such a decision. In order to clarify back-end reasons, Gary Gensler has made a statement in which he felt that the decision requires explanation.
He enlightened that there were two types of Bitcoin ETF applications which were pending before the SEC. One set of applications were those which were for future ETF and the other was for spot Bitcoin ETF. However, the permission has been granted only to the extent of Bitcoin futures ETF. As regards for the spot Bitcoin ETF, the applications are still pending and no permission so far has been given.
While elaborating upon his decision to allow future Bitcoin ETF he reiterated his statement that SEC is in favor of innovation. It acts as a neutral department when it comes to promoting an innovation. However, it does not comprises on policies for the sake of innovation. Policies come first and innovation comes after, said Gensler. He argued that SEC’s basic aim is to provide the best possible protection to the consumers and investors. If SEC finds that a project is not harmful for the consumers and investors, then there is no logic in holding approvals in abeyance.
Gensler also commented that future Bitcoin ETF was firstly approved by Commodity Futures Trading Commission (CFTC). After thorough scrutiny and due deliberation, CFTC granted ETFs permission to a company called Chicago Mercantile Exchange. So if CFTC can do so they why not SEC, said Gensler.