Second time’s the charm. Following the fear experienced by investors last night due to the hacking of the US Securities and Exchange Commission (SEC) account Spot Bitcoin ETFToday The regulator has personally approved the financial product jointly offered by Ark Invest and 21 Shares. This is a huge development for an industry that has been seeking institutional support to stabilize and consolidate the crypto asset market for months. However, SEC Chairman Gary Gensler warned in a statement that today’s action is limited to the ETS and “in no way should it indicate the Commission’s intent to approve listing standards for cryptoactive securities.”
Major digital currencies received good news with increases in the stock market. As soon as the confirmation was announced, Bitcoin came out of the red with a slight increase of 0.60%, while Ethereum rose 8.35%, Cardano rose 7.56%, and other relevant cryptocurrencies in the industry such as avalanche, polygon or uniswap exceeded 9%. While Solana was more cautious with an increase of 2.45%, Binance coin lost 0.46%.
Bitcoin exchange traded fund must meet three requirements. The sponsors of this ETF “will be obliged to provide complete, fair and accurate information about the products” so that investors will have all the information at their disposal. Additionally, “these products will be listed and traded on registered national exchanges,” which are required to have standards to prevent fraud and will be closely monitored by the SEC to ensure compliance with those standards. Gensler emphasizes that “the Commission will thoroughly investigate any fraud or manipulation in the securities markets, including systems using social media platforms.” And finally, to ensure free competition, the SEC approved the review of 10 other bitcoin spot ETF applications.
Institutional recognition
Approval of this first ETF on spot bitcoin prices It opens the door for the same thing to happen in nearly 10 applications made.Some are from large asset managers like BlackRock, Fidelity, Wisdom Tree or Invesco. For these cases, we will have to wait until March, when the SEC’s decision period expires. This is an important step for the crypto asset industry because, as Gensler explained in his statement, the SEC rejected more than 20 Bitcoin exchange-traded fund proposals between 2018 and March 2023. One of these offers came from Grayscale, which is considering the conversion. Conversion of Grayscale Bitcoin Trust into an ETF.
“We are now faced with a series of new demands similar to those we have rejected in the past,” he continues, but “circumstances have changed.” The United States Court of Appeals for the District of Columbia Circuit Grayscale failed to adequately explain its rationale for not approving the ETF’s listing and trading, rescinded the firm’s order and referred the matter back to the SEC. “Taking into account these conditions and the conditions that the approved ETF must have,” Gensler states that “the most sustainable path forward is to approve the listing and trading of these spot bitcoin ETF shares.”
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Of course, the president SEC clarifies regulator’s position. “The approval also means nothing about the Commission’s views regarding the status of other cryptoassets under the federal securities laws or the noncompliance of certain participants in the cryptoasset market with the federal securities laws.” don’t notice. He also adds, without judging a specific crypto asset, that “the vast majority of crypto assets are investment contracts and are therefore subject to federal securities laws.” In case it wasn’t clear enough, then state it even more strongly: “Today’s action does not endorse or endorse crypto trading platforms or brokersoften do not comply with federal securities laws and often have conflicts of interest.
Industry enthusiastically welcomes approval of bitcoin exchange-traded fund. Leif Ferreira, CEO and co-founder of Spanish exchange platform Bit2Me, stated that the measure “will increase volume in the bitcoin market and add extra buying pressure to a market that already has limited supply.” It will also help “establish a higher level of credibility and legitimacy for cryptocurrencies.”