In a recent development, a group of bipartisan members from the House Financial Services Committee sent a letter to Gary Gensler, the Chair of the U.S. Securities and Exchange Commission (SEC), urginghim to expedite the approval of spot Bitcoin exchange-traded products (ETPs). This request was made to the SEC on September 26.
The members of Congress critiqued the SEC’s approach to ETPs, suggesting that their treatment of these innovative financial products appears unfavorably biased. They assert that it’s the commission’s responsibility to make compliant financial products available to investors.
Spot Bitcoin ETPs are a class of investment products that track the price of Bitcoin rather than the future contracts. Investors tend to prefer these over Bitcoin futures ETFs as they feel it gives a more accurate reflection of the cryptocurrency’s actual value. Despite this preference, the SEC has yet to take a forthright stance on spot Bitcoin ETPs, proving a source of frustration for those members of Congress anxious for their constituents to have these investment options.
As at the moment, it remains to be seen how the SEC will respond to this call. The regulatory body has in the past displayed some caution regarding cryptocurrency regulation, ostensibly due to the volatility and unpredictability associated with the relatively young market.
This information is brought to you via a report from Orrick, Herrington & Sutcliffe LLP.