The possibility of a Bitcoin exchange-traded fund (ETF) focused on spot trading gaining approval from the U.S. Securities and Exchange Commission (SEC) appears unlikely, according to John Reed Stark, the former head of the agency’s Office of Internet Enforcement. In a recent post on X, Stark expressed his belief that due to various strong justifications, the present SEC administration is unlikely to give the green light to a Bitcoin spot ETF application.
SEC’s continued crypto scrutiny might depend on the 2024 elections
While Stark wrote that he did not see the agency approving a spot Bitcoin ETF, he mentioned that in the scenario where a Republican candidate emerges victorious in the 2024 presidential election, there is a high probability that the agency will reduce its activities related to crypto enforcement. This shift in approach could result in a more favorable attitude towards endorsing a Bitcoin spot ETF and adopting additional noteworthy crypto-supportive regulatory measures.
Furthermore, Stark contends that in the event of a Republican candidate securing the presidency, the present chair, Gary Gensler, might opt to step down from his position. That could pave the way for Hester Peirce, widely recognized as “Crypto Mom” within the field, to assume the role of acting chair. Consequently, any upheaval related to crypto within the the agency could come to an abrupt standstill.
Meanwhile, back in 2021, Ark Investment Management and 21Shares took the initiative to seek approval from the SEC for their ETF proposals. Unfortunately, their pursuit of authorization encountered an obstacle when the agency delayed their second endeavor earlier this year. Cathie Wood, the CEO of Ark Invest, said that she had foreseen this delay. She had shared her anticipation of the agency approving multiple ETF applications simultaneously, pointing out that given the similar nature of these applications, the differentiation would revolve around marketing, communication, and the conveyed message.
SEC is increasing crypto scrutiny
Lately, there has been a noticeable escalation in the SEC’s endeavors to enforce regulations within the cryptocurrency domain. Recently, the Bittrex crypto exchange reached a settlement of $24 million with the agency after facing charges in April for operating as an unregistered exchange.
Additionally, on Wednesday, the agency submitted a letter to the Southern District of New York seeking permission for an interlocutory appeal regarding the summary judgment order in the Ripple Labs case, widely interpreted as a partial defeat for the agency.
Source: Cryptopolitan
