The former chairman of the US Securities and Exchange Commission (SEC) says the approval of a Bitcoin (BTC) exchange-traded fund (ETF) in the spot market will inevitably happen.
In a new interview on CNBC Squawk Box, former SEC Chairman Jay Clayton say that the approval of a BTC ETF in the spot market is inevitable, as it is clear that the main crypto asset by market capitalization is not a security.
“Obviously Bitcoin is not security. It is clear that Bitcoin is something retail investors want access to, institutional investors want access to, and more importantly, some of our most trusted providers who are fiduciaries or have duties of best interest want to offer this product to the private public . That’s why I think approval is inevitable. The dichotomy between a futures product and a cash product cannot last forever.”
Last month, the SEC lost a legal battle against Grayscale over the rejection of the crypto firm’s application to create a spot market BTC ETF. The judge in the case ruled that the SEC must reconsider its position to remain consistent.
In the past, the SEC approved futures BTC ETFs but rejected numerous bids to create spot market BTC ETFs, which would allow retail investors to access BTC through a brokerage, much like precious metals.
According to Clayton, the fact that major financial institutions are establishing surveillance networks to monitor BTC ETFs in the spot market means the SEC’s concerns about investor safety should be quelled.
“I felt we weren’t sure if cash trading was so easy to manipulate that retailers shouldn’t have access to it. There are big institutions now with oversight mechanisms coming in and saying, ‘No, that’s not the case.’ We can sufficiently rely on the effectiveness of the money market if we believe it to be a legitimate product.”
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