It’s not all plain sailing. While the SEC’s rejections of Bitcoin ETFs are often attributed to a simple lack of will on the part of Gary Genslerthings finally appear a little more nuanced. Of course, the boss of Security and Exchange Commission (SEC) makes no secret of its animosity towards cryptos in general and Bitcoin in particular. However, the interview with a player in the sector brings a little complexity back into the thinking and puts the finger on several important points about the hesitations of the SEC. Timetable, red tape, past examples, Sui Chung sifts through the last few months, repositioning the debate around issues that go beyond the cryptosphere. What are we waiting for?Bitcoin fans ask? It’s not all that easy, answers this specialist. Here’s a selection.
Internal SEC reasons as the primary cause of the postponement
Sui Chung is CEO of CF Benchmarks a company specializing in blockchain data that will provide the key indices needed to track ETF Bitcoin including those of BlackRock, Valkyrie or Wisdom Tree. In close touch with requests, files submitted and follow-up, it now provides a light He begins directly with some very pragmatic considerations which partly explain the course of events. First of all, he focuses on the period under discussion, i.e. last summer.
For him, it seems obvious that at this time of year, no one on the side of the SEC was in a position to draw up a file of such importance and of such an complexity. Crazy as it may sound, summer is not the right time for this type of work:
« In practice, nobody will write a 200-page essay in August, anywhere in the world, whatever their job! Whether he works for the SEC, Goldman Sachs or Coca Cola, it simply doesn’t happen. »
Sui Chung, CEO of CF Benchmarks, on the SEC – Source: The Block
Beyond this rather surprising comment, he also explains that the approvals will probably all arrive at the same time, as the files are very similar. In that case, will all the players be ready? And when will they be ready? The very next day? The custodians too? Intermediaries too? This is a source of considerable concern for the regulator, and here again, the answers are not at all obvious.
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The democratization of ETH futures ETFs could help the cause of Bitcoin cash ETFs
Next, our witness of the day details how the Ethereum futures ETFs that already exist could be a kind of Trojan Horse for Bitcoin. Little by little, professionals will become interested in these products, find out more about them and, why not, get closer to Bitcoin later on. Traditional finance is evolving much more slowly than the crypto sector, and to all those who imagine that things could change in a few months, he replies that the SEC takes its time.
Similarly, the acceptance ofETF futures on ETH will not automatically pave the way for ETFs on cash. The cause? First and foremost regulatory. Futures contracts are regulated by the CFTC and, by extension, ETFs on these contracts are therefore also covered by the law. This is not (yet) the case for spot cryptos.
Could gold and Bitcoin be regulated in the same way?
Finally, he compares the introduction ofETF Bitcoin cash ETFs with those indexed to thephysical gold. Here again, moderation is the order of the day. For him, financial asset prices must not be manipulated, and prices must be determined by both the spot and futures markets. That’s what’s happening with gold, and for the time being, no one can say with any certainty how the gold market will work. Bitcoin in the years to come, or even if it will be able to fit into the Securities and Exchange Act of 1933. So it’s urgent to do nothing and think things over before going any further.
By the way, to keep an eye on all this, there is currently theIntermarket Surveillance Group (ISG), which oversees all market operations in search of irregularities, and which should be brought into line with crypto in the very near future. Finally, for Sui Chungthe approval of these ETF would bring about such a change in the financial landscape that he understands that the SEC takes its time. However, he deplores the fact that the nature of the debates and the progress of the discussions remain opaque and secret, but acknowledges that this has always been the case within the American regulatory body, which has always remained light-hearted. Prisoner of the past.
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