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The SEC: Fighting Crypto or Helping?

  • There are mixed feelings regarding the stance that the U.S. Securities and Exchange Commission (SEC) takes towards cryptocurrencies
  • The SEC is said to be working on a regulatory framework for the cryptocurrency markets with its chairman, Gary Gensler, who is crypto inclined
  • On the other hand, there are reports that the reason for the delay in approving the VanEck Bitcoin ETF application comes amidst deliberation of potential pitfalls for retail investors
  • The SEC is also fighting a legal battle against the crypto Ripple (XRP), arguing that the crypto is not a security

The Securities and Exchange Commission (SEC) is one of the regulatory agencies saddled with the responsibility of administering federal securities laws that protect investors in different sectors, including cryptocurrencies.

Regarding the crypto sector, there has been no clear direction from the SEC. While there are hopes of a regulatory framework that will clear all doubts regarding the cryptocurrency markets, the SEC’s lingering battle with Ripple doesn’t seem to agree with that.

Now, there are further doubts regarding the stance of the SEC as reports emerge that the regulatory agency will be needing more time to approve the VanEck Bitcoin ETF application.

More Time Needed for the Approval of VanEck’s Bitcoin ETF

At the end of 2020, Investment management company VanEck filed an application for a Bitcoin ETF. However, the approval decision which should naturally take 45 days to be made, has lingered, with the SEC now requesting for even more time.

Bitcoin watchers who for long have believed that 2021 will finally be the year when EFTs get approved, will have to wait a little longer to see their dreams come true.

The initial 45-day window for the VanEck Bitcoin ETF which was to end on May 3 has been postponed by the SEC. On Wednesday, the SEC announced that it is delaying its decision on approving the VanEck Bitcoin ETF until June.

J. Matthew DeLesDernier, assistant secretary at the SEC, said in a filing:

 “The Commission finds that it is appropriate to designate a longer period within which to take action on the proposed rule change so that it has sufficient time to consider the proposed rule change and the comments received.”

The filing did not include an official reason for the postponement, only that it is “appropriate” for the postponement to be made.

Some reports claim that the delay is likely because the SEC is mulling over the potential pitfalls for retail investors. These concerns arise from the fact that cryptos are very volatile and there is the potential for manipulation.

On the Flipside

  • 3iQ Corp. (“3iQ”), the largest digital asset manager in Canada has launched another Bitcoin ETF
  • The ETF is available in Canadian dollars under the symbol “BTCQ” and in U.S. dollars under the symbol “BTCQ.U”
  • Launched on April 19, the ETF has already attracted more than C$250 million of investor capital.

What the Approval of VanEck’s Bitcoin ETF Would Mean

The approval of VanEck’s Bitcoin ETF under review would be the first of its kind in the United States. The EFT will give investors direct exposure to the asset class.

The recent confirmation of Gary Gensler has given some bitcoin watchers the belief that 2021 could finally be the year. Gensler is considered a cryptocurrency expert with experience in teaching courses on digital currencies and blockchain at the Massachusetts Institute of Technology.

ETFs gives investors the convenience of seamlessly trading Bitcoin without the risks associated with holding the cryptocurrency or the hassle of learning how the underlying technology works. If approved by the SEC, ETFs could have a positive impact on the cryptocurrency and increase the number of Bitcoin investors in America.

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    This article is for information purposes only and should not be considered trading or investment advice. Nothing herein shall be construed to be financial legal or tax advice. Trading Forex, cryptocurrencies, and CFDs poses a considerable risk of loss

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    Author

    Milko Trajcevski has been in the crypto world for years, and as such has gathered both a skill for writing as well as a native prowess when it comes to understanding everything that occurs within that world. Through skilled writing and determination, he covers articles about cryptocurrency, tokens, blockchain, crypto-asset regulations, crypto wallets, exchanges, liquidity, DApps, forks, mining, security, and blockchain technologies. He is a professional with a track record of proven expertise within the crypto space.