Blockchain advocacy group Chamber of Digital Commerce has called on the SEC to approve a spot Bitcoin ETF to prevent U.S. Bitcoin investors from turning to more crypto-friendly countries.
A bitcoin exchange-traded fund (ETF) allows investors to gain exposure to Bitcoin without actually owning any. It can be traded on stock market exchanges making it easier for traditional investors to gain exposure to the asset class.
So far, the US allows investors to invest through bitcoin futures ETFs but is yet to approve a bitcoin ETF. Bitcoin futures ETFs are backed by bitcoin derivatives while spot ETFs are backed by actual bitcoin.
Since 2013, 16 crypto companies have applied for approval to offer spot bitcoin ETFs. The applications were denied by the SEC citing inadequate protection against bitcoin price manipulation.
The advocacy group in its latest publication said that the concerns of the SEC have been addressed. So far, there has been no record of bitcoin ETFs price manipulations as exchanges have implemented surveillance tools to check against market manipulation.
The Chamber of Digital Commerce said that the SEC’s failure to approve a spot bitcoin ETF is forcing U.S. investors to turn to other regulated regions like Canada, German, Sweden, Switzerland, and Australia.
The group added that the delay by the SEC to approve a spot ETF is costing the economy more capital flight.
As the SEC continues to stonewall, the United States continues to fall behind other countries as capital that would have been invested in the United States, which would be managed by U.S. firms employing U.S. persons is instead deployed in other, more innovation-friendly countries.
The Chamber of Digital Commerce said that it believes that “the time has come for U.S. investors to have access to a Bitcoin ETF.”
A Jurisdictional Land Grab
The Chamber of Digital Commerce also accused the SEC chair Gary Gensler of intentionally delaying spot bitcoin ETF approvals to extend control the SEC has over crypto exchanges on which Bitcoin trades.
It is becoming clear that the true pretext for blocking #bitcoin ETF applications is based not on an unmet legal standard but rather as a means of effectuating a jurisdictional land grab. 5/7 pic.twitter.com/4y2ptkZovH
— Chamber of Digital Commerce (@DigitalChamber) September 12, 2022
Gary Gensler has affirmed that “bitcoin was a commodity and not a security.” As a result, Congress is looking to allow the Commodity Futures Trading Commission (CFTC) to regulate cryptocurrencies like Bitcoin and Ethereum.
Notwithstanding, the SEC chair is working to regulate Bitcoin ETF indirectly by regulating crypto exchanges. SEC Commissioner Hester Peirce reportedly said:
“I think (Chairman Gensler) is trying to pull those crypto platforms into our orbit.”