- The SEC recently approved three Bitcoin Futures ETFs, but is yet to allow one that tracks the cryptocurrency’s spot market price.
- A spot ETF would allow direct exposure to BTC, with investors tracking the current spot market price of the cryptocurrency.
- For its rejection of past spot ETF applications, the SEC has maintained the crypto sector is not ready given the potential for consumers to be exposed to fraud and price manipulation.
Grayscale has told the US Securities and Exchanges Commission (SEC) that its decisions against spot Bitcoin exchange-traded funds (ETFs) is incongruous with the regulator’s other actions related to Bitcoin futures ETFs.
In a letter the investment management firm sent to Vanessa Countryman, the SEC’s secretary, Grayscale points out some of the reasons it says explains why the securities watchdog has “no basis” to keep rejecting Bitcoin spot ETFs.
Grayscale’s letter comes days after the SEC once again rejected another physically-settled BTC exchange-traded fund, adding the proposal by VanEck to a long list of applications thrown in the dustbin.
According to the firm, which has applied to have its flagship Bitcoin Trust (GBTC) approved as a spot-based exchange-traded product (ETP), questions why the regulator has seen it fit to approve futures-based bitcoin ETFs and not one that tracks the actual cryptocurrency’s spot price.
Over the past few weeks, the SEC has allowed investments in the ProShares, Valkyrie, and VanEck futures-based ETFs. Incidentally, the approvals came on the back of comments from SEC Chair Gary Gensler that appeared to favour futures-based over spot-based Bitcoin ETFs.
“The Commission has no basis for the position that investing in the derivatives market for an asset is acceptable for investors while investing in the asset itself is not,”
