Ark Invest CEO Cathie Wood has responded to a hacker who posted an endorsement for a Spot Bitcoin ETF on “The Claman Countdown.”
They finally did it.
Securities and Exchange Commission gives retail investors access to Bitcoin, the world's largest digital asset, by approving the initial sale and distribution of 11 exchange-traded funds that track the asset's daily or “spot” price I paved the way.
SEC Chairman Gensler’s Statement on Spot Bitcoin ETFS
Late Wednesday afternoon, the commission gave the green light for ETF trading in the U.S. in a 3-2 vote, following a series of embarrassing technical errors and a hack of the SEC's social media accounts.
Until now, small investors who wanted to trade digital assets had to buy and sell on unregulated crypto exchanges, sometimes falling victim to scams and scams. The most notable example is the case of convicted former crypto tycoon Sam Bankman Freed, who embezzled $8 billion in customer funds on the now-defunct FTX exchange.
The U.S. Securities and Exchange Commission (SEC) announced Friday that it is delaying implementation of new disclosure rules for off-exchange securities for certain assets until January 3, 2022.Photographer: Andrew Haller/Bloomberg via Getty Images (Photographer: Andrew Haller/Bloomberg/Getty Images)
Starting Thursday, ETFs tracking the daily or spot price of Bitcoin will begin trading on the Nasdaq, the New York Stock Exchange, and the CBOE, a key indicator of the maturation and mainstreaming of the $1.7 trillion crypto market. do. They can purchase ETFs through the country's most venerable asset managers, including BlackRock, Fidelity, and Grayscale (which specializes in digital assets), and they trade on the world's most regulated stock exchanges. .
SEC Fooled, X Account Hacked, Spot Bitcoin ETFS Disapproved
In 2021, the SEC approved the sale of a Bitcoin ETF that tracks the futures market. The main difference is that futures products can only be sold to accredited investors, or those who are considered “sophisticated” and wealthy.
The new Spot Bitcoin ETF can be sold to any investor. These can be purchased through brokers or on discount intermediary apps, meaning millions of new investors could soon own a piece of a crypto business.
“I celebrate the right of American investors to express themselves. their “By buying and selling Spot Bitcoin ETPs, we will spread the word about Bitcoin,” said SEC Commissioner Hester Peirce. I would like to commend the participants for their perseverance.”
Peirce was one of three committee members who voted to approve the ETF.
The journey of the cryptocurrency industry to this point has not been smooth. Regulatory oversight of cryptocurrencies has increased since the SEC began its attempt to regulate cryptocurrencies in 2017, when former SEC Chairman Jay Clayton filed enforcement actions against several so-called initial coin offerings. is extremely difficult. As his final act as chairman, Clayton filed a lawsuit against cross-border payments company Ripple for selling the token claimed to violate securities laws.
However, given the regulatory gray area surrounding digital coins, courts have questioned the SEC's attempts to regulate the cryptocurrency market in recent months. Ripple spent about $200 million fighting the SEC lawsuit and won after three years in court. A U.S. district judge has ruled that the company's sales of XRP to institutional investors such as banks do violate securities laws. Despite the SEC's claims, no sales were made to secondary market investors on the virtual currency exchange.
Live Cryptocurrency Prices: Here
The SEC said it plans to appeal the ruling.
In this photo illustration taken on January 9, 2024 in Brussels, Belgium, the United States Securities and Exchange Commission seal is displayed on a smartphone with Bitcoin displayed on the screen in the background. (Photo illustration by Jonathan Raa/NurPhoto via Getty Images / Getty Images)
Current SEC Chairman Gary Gensler, appointed by Biden, has been even tougher on the crypto industry, filing more than 20 enforcement cases against the industry in 2023 alone. The move includes major exchanges like Coinbase and Binance, both of which, like Ripple, plan to fight the commission in court.
However, experts argue that this loss specifically paved the way for the European Commission's approval of the Bitcoin Spot ETF. Grayscale won a victory against the SEC in August 2023, when the D.C. Court of Appeals ruled that the company could not outright deny its request to convert its Bitcoin Trust product into a spot ETF. .
The Judiciary Committee ruled that the SEC needed to take a closer look at the application, a signal that many would-be ETF issuers had been waiting for.
Over the summer, applications for spot Bitcoin ETFs flooded in from major asset management companies and crypto-related organizations. Other crypto companies like Cathie Wood's Ark21Shares product and Bitwise have already submitted applications earlier this year, bringing the total number of applicants to 11 by the end of 2023.
DUBAI, UAE – DEC 04: BlackRock CEO Larry Fink attends a roundtable discussion entitled 'Financing the New Climate Economy', in which he discusses climate change He said a “new financial landscape” was urgently needed to finance investment in the United States. (Sean Gallup/Getty Images/Getty Images)
BlackRock CEO Larry Fink, once a Bitcoin bear, told FOX Business in October that he now views Bitcoin as a store of value and an international asset. he said. Changing attitudes on Wall Street, combined with pressure from the courts and the backing of a man of stature like Larry Fink (who runs the world's largest money management company), has led to a shift in Bitcoin spot products. Approval became inevitable.
Bitcoin rebounds early
Securities lawyers say Gensler's disdain for the asset class means the agency will require ETFs to be structured as cash-only, meaning investors can buy and redeem ETF shares only with cash, not Bitcoin. He said that it was clear from an early stage because of the This differs from traditional commodity-based ETFs, where customers can purchase stocks using the underlying assets.
The SEC remains concerned that the cryptocurrency market is largely unregulated and susceptible to malicious actors.
While the SEC considered these factors in approving ETFs, FOX Business recently concluded that allowing investors to trade Bitcoin in the form of securities on highly regulated exchanges is a better option for retail investors. He revealed that he has come to the conclusion that it is better than trading digital coins through opaque means. As has always been the norm.
In addition to the myriad hurdles the industry had to clear leading up to Wednesday's approval, the SEC's official X (formerly Twitter) account that falsely announced on Tuesday that the ETF was ready to begin trading There were also a series of blunders on his part.
A representation of Bitcoin can be seen in an illustrated photo taken on June 23, 2017. (Benoît Tessier/File Photo/Reuters Photo)
Late Tuesday, the price of Bitcoin soared nearly $48,000 on fake news before the SEC regained control of the account, and Mr. Gensler used his personal X account to retract his statements, giving an embarrassed market his I had to let my agency know that their account had been compromised.
Following Gensler's clarification, Bitcoin prices suffered a small crash, trading around $45,000. Following the ETF's approval, the digital asset is trading relatively flat at $46,500.
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The mysterious circumstances and unprecedented nature of the SEC hack have many industry watchers believing the SEC will delay approval further beyond the January 10 deadline. Minutes before the close of trading on Wednesday, the SEC made another mistake by prematurely posting the issuer's 19b-4 form approval, but then withdrew the approval again before making a formal announcement after the closing bell at 4 p.m. Ta.
