The U.S. crypto community has long viewed Gary Gensler as a thorn in their side. Over the last few years, the U.S. Securities and Exchange Commission (SEC) chair has taken a get-tough approach to cryptocurrencies—and stressed, relentlessly, the need for policing the industry.
During a Senate hearing with lawmakers on Tuesday, Gensler stepped up his offensive against the crypto industry. He said the SEC is still reviewing the Grayscale ruling, along with a long list of Bitcoin spot exchange-traded fund (ETF) applications.
The SEC chairman was fielding a question by Senator Hagerty (R-TN), who asked, during the hearing, what the regulator needs to see in a filing to greenlight a spot Bitcoin ETF.
“We have multiple filings around Bitcoin exchange-traded products, so it’s not just the one you mentioned, but it’s multiple others who we’re reviewing. I’m looking forward to the staff’s recommendations,” Gensler said in his testimony to the Senate Banking Committee on Tuesday.
Reiterating his views about the dangers of cryptocurrencies, Gensler said the industry is the “Wild West of non-compliance”—and rife with “fraud, abuse, and misconduct.”
Gensler’s statement came against the backdrop of a federal judge’s bombshell ruling last month that said that the U.S. regulator was wrong to reject crypto asset manager Grayscale Investments’ proposal for a Bitcoin spot ETF, calling the agency’s decision “arbitrary” and “capricious.”
Spot Bitcoin ETFs have become the talk of crypto town recently. While the SEC has balked at the idea of such a product, – and rejected applications for the same over the years, – leading institutional investors, along with retail traders, are waiting with open arms for the product’s approval, as it would give them exposure to Bitcoin, the world’s largest cryptocurrency, without having to hold the asset.
Following its court victory against the SEC, Grayscale sent a compelling letter to the agency, requesting the regulator to “expeditiously” approve its application to convert its spot Grayscale Bitcoin Trust into an ETF that would track Bitcoin.
Several big names, including the likes of BlackRock, the world’s largest fund manager, and Boston-based investment behemoth Fidelity, have also filed for a spot Bitcoin ETF. Asset manager Franklin Templeton is the latest Wall Street giant to join the fray.
It’s worth noting that while the SEC has for years rejected spot Bitcoin ETFs, it has given its blessing to Bitcoin futures ETF, which track agreements to buy or sell Bitcoin at a pre-agreed price. While asset managers, including Grayscale and Arca, among others, suggested using the same market manipulation safeguards that were brought in for Bitcoin futures ETFs, the regulator contends they are not sufficient.