Former SEC Chair Says BlackRock Bitcoin ETF “Incredible Development,’’ Outlines Approval Criteria

Attempts by BlackRock and other top money managers to launch spot Bitcoin ETFs are an ‘’incredible development,’’ and may be difficult to resist, said a former Chair of the US Securities and Exchange Commission

Jay Clayton, who served as SEC Chair from 2017 until 2020, told CNBC in an interview on July 10 that if BlackRock can prove to the SEC that the spot Bitcoin market has the same protections as the futures market, it would be hard to resist approval.

The first bitcoin futures ETF was launched in October 2021, and was one of the most heavily traded ETFs in market history, attracting assets of more than $1 billion in its first few days of trading, according to the Bank for International Settlements. The future ETF was approved after the SEC decided their were sufficient protections for investors.

Companies whose reputation in the market matters are now saying that they think those protections are sufficient for a spot Bitcoin EFT and are willing to put their name on it, said Clayton.

“That’s actually an incredible development,’’ he said. “If they’re right that you can demonstrate that the spot market has similar efficacy to the futures market it would be hard to resist approving a bitcoin ETF.’’

MARKET NEWS
– SEC Chairman Jay Clayton suggests #Bitcoin 's Spot ETF may be approved, bringing it to Wall Street.
– Approval of the ETF could cause a frenzy in the market.
– Prices have the potential to soar to $125,000.
Increased investments in #altcoins #Pulsechain pic.twitter.com/snnSOnk7qT

— InvestDex (@InvestDexio) July 11, 2023

BlackRock Refiled Spot Bitcoin ETF Application

BlackRock, the world’s biggest money manager with assets under management of about $9 trillion, refiled an application for approval of a spot Bitcoin ETF last week. The fact that it has an almost perfect record at gaining approvals with the SEC has buoyed optimism in the crypto community that a landmark breakthrough may be imminent. Since BlackRock filed its original application on June 15, Bitcoin has surged about 21% to $30,389.

Other firms vying for spot bitcoin ETF approvals include Fidelity, Cathie Wood’s Ark Invest, Invesco, VanEck, and WisdomTree. Still, the SEC may be a tough nut to crack and has said the filings by BlackRock and others lack clarity and comprehensiveness and are inadequate. LINK

Clayton told CNBC that when he was SEC chair he was very sceptical of trading in the Bitcoin market, and that studies back then showed 90% of activity was ‘’wash trading,’’ and that the market was ripe for manipulation.

“The fact that we have these institutions that know markets better than anybody and are saying, `You know we’re going to put our reputation behind it.’ I find that pretty remarkable,’’ Clayton said.

BlackRock CEO Larry Fink last week said cryptocurrencies are “digitizing gold’’ and that Bitcoin may help ‘’revolutionise finance,’’ underscoring why the world’s biggest money manager is striving to launch a spot bitcoin ETF.

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