Dems Ask SEC's Gensler to Block Approval of More Crypto ETPs

[TomPluz]

Two Democrat Senators are urging the Securities and Exchange Commission (SEC) to block any further crypto exchange-traded products (ETPs) to protect retail investors from risks associated with poor broker disclosure and thin liquidity in major cryptocurrencies.

Sen. Jack Reed (D-R.I.) and Sen. Laphonza Butler (D-CA) write that a FINRA survey disclosed that 70% of brokers’ communications with retail investors violated fair disclosure rules.

The Senators also argue that by naming bitcoin exchange-traded funds as such, the name “obfuscates important characteristics about these investments.”

“Retail investors should be made aware of how these ETPs differ from more common funds which they may have experience,” they said in the letter, writing that bitcoin is not subject to the same protections under the Investment Company Act of 1940 that ETFs which hold shares of various companies would have.

Read more here: https://www.coindesk.com/policy/2024/03/15/democrats-ask-secs-gensler-to-block-approval-of-more-crypto-etps/

Though I am a little bit sympathetic with the concerns raised by the two Democrat senators, one thing is clear to me that there are more people in the Democratic Party who are not so friendly with the cryptocurrency industry although they received a lot of donations coming from famous players like SBF. So can we then expect that SEC will put a halt with approving more ETFs into the future and do you think this can be affecting the ETF for ETH?

[Charles-Tim]

So can we then expect that SEC will put a halt with approving more ETFs into the future and do you think this can be affecting the ETF for ETH?

Senators are lawmarkers and not regulations. They should stop saying what is not. They should raise the issue within themselves and let us see if they will win and pass a bill not to create other crypto ETF rather than disturbing SEC governor. If I am Gensler, I will not listen to the two senators. If ETH meets the criteria needed for the ETF approval, why not approve it.

[hugeblack]

Is there enthusiasm to include more cryptocurrencies, since if I were an investor, I would prefer Bitcoin or Ethereum as a minimum, and I will not try to deposit in unknown and high-risk assets such as small marketcap altcoin. Therefore, I do not think that there is sufficient demand to make such things available for trading in the ETFs markets and for those who do not want to. By purchasing altcoins, he can invest in Grayscale, which will act as an indirect intermediary for investing in such altcoins, so the controversy over this topic will not continue for long.

[Themepen]

Though I am a little bit sympathetic with the concerns raised by the two Democrat senators, one thing is clear to me that there are more people in the Democratic Party who are not so friendly with the cryptocurrency industry although they received a lot of donations coming from famous players like SBF. So can we then expect that SEC will put a halt with approving more ETFs into the future and do you think this can be affecting the ETF for ETH?

It is normal to worry about donations from crypto companies may affect political choices. But it is good to make decisions about rules based on careful thinking and understanding how they may affect investors and market. SEC should be careful about approving more ETF in future but this should not just be because of donations. Most important thing is to make choices that are good for investors and keep market stable. Basically I think they want to control over the crypto market but in my point of this is not possible or you can say extremely difficult.

[yhiaali3]

I expect that these concerns are intended specifically for Ethereum, since there is currently talk about the possibility of listing ETH spot ETFs, so it is expected that there will be strong opposition.

There will be a lot of controversy and discussion about the issue in the beginning, but in the end they will acquiesce if there are large, influential companies with requests, as happened with Bitcoin, where there was strong opposition at the beginning and then approval was obtained after that. As I heard, there are 8 companies that have already applied.

[Jating]

So can we then expect that SEC will put a halt with approving more ETFs into the future and do you think this can be affecting the ETF for ETH?

Senators are lawmarkers and not regulations. They should stop saying what is not. They should raise the issue within themselves and let us see if they will win and pass a bill not to create other crypto ETF rather than disturbing SEC governor. If I am Gensler, I will not listen to the two senators. If ETH meets the criteria needed for the ETF approval, why not approve it.

I would agree, but as a collective party, they are very much powerful just like what the Dems is right now. And they have been putting pressures already to SEC because as far as I can remember, there were a leak memo or something coming from the party urging SEC to not approved any Bitcoin ETF.



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