Lawmakers in the United States have finally put their foot down and demanded that the US SEC Chairman “immediately” approve Grayscale’s spot Bitcoin ETF proposal.
US Congress gives immediate approval to Spot Bitcoin ETF
A group of four members of the United States Congress sent a letter to Gary Gensler, Chairman of the United States Securities and Exchange Commission (SEC) on Tuesday, September 26, demanding early support of a spot Bitcoin ETF.
The letter describes major flaws in the US SEC’s rejection of Grayscale’s spot Bitcoin ETF proposal, stating that if the SEC fails to provide appropriate clarification for its different regulatory treatment of spot bitcoin ETFs and bitcoin futures is unable, its rejection will be seen as a “Unlawful” discrimination.
The letter was signed by prominent US lawmakers including Mike Flood, Richie Torres, Tom Emmer and Willie Nickell. The lawmakers said Congress is tasked with ensuring that the US SEC meets all investment product requirements created by Congress.
Members of Congress have also shown support for the introduction of a Spot Bitcoin ETF and said that the Spot Bitcoin ETF will ensure that investors are properly protected from investment risks as there will be better clarity on the Bitcoin cryptocurrency.
“A regulated spot Bitcoin ETP would provide increased protection for investors by making access to Bitcoin safer and more transparent,” the US lawmakers said.
A hearing between the US SEC Chairman and Congress is scheduled for Wednesday, September 27, and Gensler may face intense scrutiny and questions over his rejection of the spot Bitcoin ETF.
US SEC delays ETF approval once again
The US SEC has continued to delay its approval for Grayscale’s spot Bitcoin ETF application from August 2023, requesting more time to deliberate on evaluating its actions in relation to the proposal.
Grayscale, a crypto asset management company, applied to convert its Bitcoin Trust into an ETF in October 2021. However, the US SEC rejected the request, stating that the crypto asset investment firm’s proposal did not meet anti-fraud and investor protection standards.
Grayscale responded by filing a court appeal in the District of Columbia, requesting the court to review the US SEC’s rejection of Grayscale’s Bitcoin ETF application.
The digital asset management company won an unprecedented victory against the US SEC, when federal appeals court judge Naomi Rao ruled against the US SEC, saying that the commission’s rejection of Grayscale’s proposal was “arbitrary and capricious” because The regulator failed to explain this. The denial of a spot Bitcoin ETF after approving similar products such as Bitcoin futures due in June 2023.
In light of the court’s decision, the crypto community and other major financial institutions like JP Morgan believe that the approval of a spot Bitcoin ETF is inevitable.
Currently the US SEC has delayed spot Bitcoin ETFs from several major crypto firms including Bitwise, BlackRock, WisdomTree, Invesco, Ark Invest, Galaxy, VanEck, and Fidelity.
The Commission has not yet responded to Congress’s demands and the crypto community is awaiting more detailed information at the September 27 hearing.
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