Congress Reps Pressure Gensler & SEC to Approve Spot Bitcoin ETFs
28 Sep 2023 by Rory Kejzerko 2 min read
Congress Reps Pressure Gensler & SEC to Approve Spot Bitcoin ETFs

In an overt push-back against the US Securities and Exchange Commission’s (SEC) hesitation towards approving the several institutional Bitcoin Spot exchange traded funds (ETF) applications, four members of the House Financial Services Committee have written a plea to the agency’s Chair Gary Gensler to change its stance. 

The bipartisan-backed letter essentially asks the SEC to end its effort of blocking Bitcoin Spot ETFs being approved. Here, obvious candidate Tom Emmer - i.e. Majority Whip of the United States House of Representatives and creator of the ‘CBDC Anti-Surveillance State Act’- was one of the four officials involved.

Within the letter, the consortium of Representatives - which also features Mike Flood (Nebraska), Wiley Nickel (North Carolina), and Ritchie Torres (New York) -  argued that Bitcoin Spot ETFs are ‘indistinguishable’ from the SEC-approved crypto futures ETFs… therefore inferring that they-too should be given the green light.

It also goes on to describe the SEC’s anti-spot ETF stance as ‘untenable moving forward,’ whilst also stating that ‘there is no reason to continue to deny such applications under inconsistent and discriminatory standards’.

With the exception of Nickel, the group of representatives are also part of the ‘Congressional Blockchain Caucus,’ a ‘bipartisan group of Members of Congress and Staff who believe in the future of blockchain technology,’ and who also ‘understand that Congress has a role to play in its development’. 

If you didn’t already know, the institutional Bitcoin Spot ETF applications in-question come from the likes of BlackRock, Fidelity, and Greyscale. Whilst many are assuming that BlackRock’s sheer capital brute (of almost $10 trillion assets under management) will eventually see its application over the line, its fellow applicant Greyscale hit headlines back in June when the SEC rejected its application to convert its Grayscale Bitcoin Trust (GBTC) into a Bitcoin Spot ETF.. 

However, Grayscale then ran-out victorious in a subsequent lawsuit against the SEC, which further lifted morale amongst applicants and onlooking entities. This was witnessed through Circuit Judge Neomi Rao’s going public with her opinion of the agency’s initial rejection of Grayscale’s application being ‘arbitrary and capricious’.

Moving forwards, it will be interesting to see what Gensler has to say about the letter when he takes the crypto hot seat once-again in a hearing scheduled for today (September 27th). Such event will be the second instalment of the ‘Oversight of the Securities and Exchange Commission’ hearing - with the first taking place earlier this month. 

Further, if tangible inroads are made amidst this congressional push for approvals, more capital inflows from investors may be on the horizon for crypto, as the main utility of Spot ETFs is to allow for easier investments through simple trade in and out services via brokerage accounts.

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This article is intended for educational purposes and is not financial advice.