Decade of Delays and Discrepancies
SEC Commissioner Hester Pierce, affectionately known as “Crypto Mom,” has been vocal about her discontent with the SEC’s prolonged hesitation to approve spot Bitcoin ETFs. The first application for a Bitcoin ETF was submitted over ten years ago, and since then, the SEC has repeatedly rejected similar proposals. Pierce criticized the SEC’s inconsistent review process, which she believes differed markedly from other exchange-traded products (ETPs). She lamented the shifting goalposts and the missed opportunities due to these delays.

SEC’s Change in Stance and Lingering Criticism
The SEC’s long-awaited approval came after a court ruling in August, which called for the review of an application by Grayscale to convert its Bitcoin Trust into a true ETF. The court questioned the SEC’s rationale for earlier denials, hinting at potential unlawfulness. While SEC Chair Gary Gensler acknowledged the change in circumstances justifying the approval, Pierce pointed out that this decision didn’t rectify the harms caused by the SEC’s earlier inconsistent treatment of Bitcoin products.

Consequences of the SEC’s Approach and Future Outlook
Pierce expressed concerns about the SEC’s approach damaging public trust, which could impede its ability to regulate markets effectively. She also criticized the wastage of resources spent in resisting these applications and the misleading impression created about the SEC’s role. Pierce bemoaned the fact that the SEC’s actions had alienated innovators in the crypto space and led to a costly legal battle.

In her reflection, Pierce emphasized the importance of celebrating the right of American investors to trade spot Bitcoin ETPs, rather than Bitcoin itself. She praised the perseverance of market participants who, despite the SEC’s obstruction, remained committed to bringing a product they believed investors wanted. The approval of spot Bitcoin ETFs by the SEC, after a long and complex journey, marks a significant milestone in the integration of cryptocurrency into traditional financial markets. Commissioner Pierce’s critique highlights the need for regulatory clarity and consistency in the rapidly evolving crypto landscape.

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SOURCE: SEC Commissioner rues decades of Bitcoin ETF rejection 1 (cryptopolitan.com)