BetterMarkets Takes Action to Halt Spot Bitcoin ETFs

  • In a proposal submitted to the SEC, BetterMarkets presented several reasons to block spot Bitcoin ETFs and recommended the rejection of all spot Bitcoin ETF applications.
  • The fate of spot Bitcoin ETFs has been a subject of curiosity for a long time. One of the reasons that recent applications differ from others is the existence of surveillance agreements.
  • Former SEC Office Chief John Reed Stark also shared these details, stating that the SEC would not currently approve a spot Bitcoin ETF.

BetterMarkets found spot Bitcoin ETF applications from investment giants such as BlackRock and Fidelity insufficient, but why?

BetterMarkets Hostility to Bitcoin

 

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In a proposal submitted to the SEC, BetterMarkets presented several reasons to block spot Bitcoin ETFs and recommended the rejection of all spot Bitcoin ETF applications. Former SEC Chief John Reed Stark later supported this proposal.

The fate of spot Bitcoin ETFs has been a subject of curiosity for a long time. One of the reasons that recent applications differ from others is the existence of surveillance agreements. These agreements have been established with the Coinbase exchange, which is listed on NASDAQ.

However, BetterMarkets deemed this insufficient and did not find the approval of these ETFs appropriate. In its report, BetterMarkets provided the following details:

“The spot bitcoin markets (1) have a history of artificially inflated trading volumes due to rampant manipulation and wash trading; (2) are highly concentrated; and (3) rely on a select group of individuals and entities to maintain bitcoin’s network. These are features of the bitcoin network that make a proposed spot bitcoin-based ETP extremely vulnerable to manipulation by bad actors, posing unnecessary risks to investors and the public interest. The proposed rule changes offer little to neutralize these threats. Their reliance on the surveillance of other markets to detect and address manipulation is wholly inadequate. For example, the CME bitcoin futures market is not a regulated market of significant size, and the surveillance-sharing agreements with Coinbase would add little or no value in detecting and deterring manipulation of any proposed spot bitcoin-based ETP. Products that pose such clear threats to investors and fail to comply with the core requirements of the law must be rejected.”

Former SEC Office Chief John Reed Stark also shared these details, stating that the SEC would not currently approve a spot Bitcoin ETF. Meanwhile, on August 11th, the SEC decided to extend the review process for Ark Invest’s spot Bitcoin ETF application and provided a 21-day comment period.

In September, the SEC will need to make decisions on more spot Bitcoin ETFs, including giants like BlackRock and Fidelity. You can see the details by clicking here.

Will the SEC Take BetterMarkets Seriously?

BetterMarkets argues in a 10-page report that spot Bitcoin ETF applications should not be accepted. Whether the SEC will take this report seriously remains uncertain, but a quick search on Google could be a significant factor in the SEC’s decision-making.

SEC is a serious institution, but can the same be said for BetterMarkets? We’ll leave that judgment to you. Could a giant like BlackRock have created a spot Bitcoin ETF without understanding market risks? BetterMarkets is skeptical of these applications. It’s less of a review and more like a hostility towards Bitcoin. While reviewing BetterMarkets’ report, we believe the SEC might be rolling their eyes.

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Gideon Wolf
Gideon Wolfhttps://en.coinotag.com/
GideonWolff is a 27-year-old technical analyst and journalist with extensive experience in the cryptocurrency industry. With a focus on technical analysis and news reporting, GideonWolff provides valuable insights on market trends and potential opportunities for both investors and those interested in the world of cryptocurrency.
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