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Right here’s Why This Former SEC Lawyer Thinks A Spot Bitcoin ETF Isn’t Coming


Latest feedback from former SEC Lawyer John Reed Stark have additional dampened optimism concerning the regulator approving any of the pending Spot Bitcoin ETF purposes.

Spot Bitcoin ETF Approval Trying Extra Unlikely

The United States Securities and Change Fee (SEC) has repeatedly denied purposes for a Spot Bitcoin ETF, and Stark has prompt that this pattern isn’t going to alter anytime quickly because the SEC will probably deny all of the pending purposes as a consequence of a number of “compelling causes.”

Whereas aligning his opinion with that of Higher Markets, Stark acknowledged that the arguments laid ahead within the nonprofit’s letters to the SEC “brilliantly” highlighted why the SEC wouldn’t approve any of those purposes.

Higher Markets had, in two separate letters (right here and right here) dated August 8, laid out arguments why the SEC ought to reject the proposed rule modifications by the Cboe BZX Change and the Nasdaq Inventory Market “to listing and commerce shares in Spot bitcoin-based exchange-traded merchandise (ETP).” 

In response to them, the Spot Bitcoin market is understood to indicate inflated buying and selling volumes as a consequence of illicit practices like market manipulation and wash buying and selling. They argue that the markets are extremely concentrated and Bitcoin’s community is maintained by a “choose group of people and entities.” All this makes any proposed Spot Bitcoin ETP prone to manipulation by “unhealthy actors” and places traders and the general public curiosity in danger. 

Of their purposes, these exchanges acknowledged that CME Bitcoin futures, a regulated market of serious dimension, may present the required knowledge and insights regarding any fraud and manipulation within the Spot Bitcoin ETF market. Moreover, they’d entered right into a surveillance-sharing settlement with Coinbase as an additional measure to forestall fraud and market manipulation.

Nevertheless, Higher Market has labeled these measures as “wholly insufficient.” They argue that the CME Bitcoin futures market shouldn’t be a “regulated market of serious dimension” and the surveillance-sharing settlement with Coinbase is inadequate to forestall market manipulation.

Bitcoin (BTC) price chart from Tradingview.com (Spot Bitcoin ETF SEC)

BTC stays weak as market awaits SEC determination | Supply: BTCUSD on Tradingview.com

Is Crypto Regulation Now Political?

Stark believes that the “crypto-regulatory tides may shift exponentially” as soon as the US 2024 elections happen. He famous the political divide relating to crypto and the way this has additionally performed out within the SEC’s clampdown on the crypto business. 

Associated Studying: Bitcoin-Pleasant Javier Milei Wins Presidential Primaries In Argentina

The SEC has been identified to come back on exhausting at a number of crypto corporations, together with two of the world’s largest crypto exchanges, Binance and Coinbase, accusing them of securities violations. Nevertheless, Stark predicts that the SEC will abandon this crypto-enforcement effort and focus extra on largely fraud circumstances ought to a Republican get elected as President subsequent 12 months.

Though the elections are slated for November 2024 (lengthy after the SEC might need selected the pending Spot Bitcoin ETF purposes), Stark has forecasted {that a} GOP-led administration may carry concerning the approval of a Spot Bitcoin ETF. 

Featured picture from iStock, chart from Tradingview.com



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