In a stern warning to the US Securities and Exchange Commission (SEC), Dennis M. Kelleher, Co-Founder and CEO of Better Markets, a non-profit organization that focuses on advancing public financial interest, has issued a statement vehemently opposing the approval of Bitcoin spot ETFs.
This development comes amidst widespread optimism among market analysts that the SEC will, in the next few days, greenlight several applications by asset managers vying to launch a Bitcoin spot ETF in the United States.
Approving Bitcoin Spot ETF Would Be A ‘Historic Mistake’ – Kelleher
On Friday, December 6, Better Markets submitted a Supplemental Comment Letter to the SEC in response to proposed rule changes by national securities exchanges looking to list and trade shares in Bitcoin spot ETFs.
In this letter, the company’s CEO, Dennis M. Kelleher, expressed strong opposition to the idea of Bitcoin spot exchange-traded products terming it a “historic mistake” that will “almost certainly” result in investor harm on a large scale.
Keheller stated that introducing these spot ETFs to the US financial markets would expose millions of American investors to certain risks associated with the crypto market, which notably includes a prevalent level of fraud and market manipulation.
Today we filed a supplemental comment letter detailing why @SECGov should reject the pending request for a #Bitcoin ETP. It had the incorrect year 2023, which has now been changed to 2024 & you can read it here: https://t.co/5eLMT6Sfen pic.twitter.com/7cFzR8XQXV
— Better Markets (@BetterMarkets) January 6, 2024
Furthermore, the Better Markets CEO believes that the SEC greenlighting this investment fund will allow various crypto companies to misrepresent their products as endorsed by the US government, potentially misleading retail investors.
According to Keheller, denying the proposed rule changes is not only a prudent move but a legal obligation demanded of the SEC. The co-founder of Better Markets also expressed his lack of faith in the surveillance-sharing agreements (SSA) that accompany many of these proposed Bitcoin spot ETFs, describing it as a mere “window-dressing.”
In conclusion, Keheller urges the SEC not to allow American investors to invest in Bitcoin either directly or through an exchange-traded product, claiming that both methods offer the same risks.
The Better Markets Boss said:
The fact that the investment vehicle will be an ETP will not protect investors; if anything, the supposed protections related to the ETP will also provide false comfort to unsuspecting investors who fall for marketers’ claims that the SEC has approved if not endorsed the product. The value of their investment will be subject to the same risks of fraud and manipulation in the bitcoin market as investors who hold bitcoin directly. The SEC must not subject investors to these risks
Bloomberg Analyst Counters Better Markets On Bitcoin Spot ETF Approval
Following the public release of Better Markets Supplemental Comment Letter to the SEC, Bloomberg ETF analyst James Seyffart has sarcastically disagreed with Kelleher on the alleged risks presented by Bitcoin spot ETFs.
Would be an absolutely criminal move for this to happen considering the time effort and energy from all these issuers AND from the SEC staff over the last few months https://t.co/QZR4pqcyga
— James Seyffart (@JSeyff) January 5, 2024
Seyraff referenced the multiple dialogues between asset managers and the SEC in the last few weeks. Notably, these discussions have led to amendments by applicants in their various proposals indicating changes that match the SEC’s requirements of investor safety in regard to such exchange-traded products.
The decision deadline for these ETF applications is on January 10. Many crypto analysts remain positive on a potential approval which they predict will lead to an increased demand for Bitcoin.
At the time of writing, the maiden cryptocurrency trades at $43,895, with a 0.21% decline in the last hour.
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