Department Commissioner Caroline Crenshaw has stated that the SEC’s approval of exchange-traded funds based on the spot price of Bitcoin is “unfounded and ahistorical.”
According to Crenshaw, this decision disregards the importance of investor protection and goes against the Commission’s core mandates.
She argues that product issuers still struggle to prevent fraud and manipulation, which was a key factor in the Commission’s rejection of similar ETF applications in the past.
Crenshaw also points out the difficulty in obtaining accurate pricing information due to the high levels of wash trading on unregulated platforms, reaching up to 77.5%.
Even large players like Binance and Coinbase have faced enforcement actions. Furthermore, Crenshaw notes that the relatively small size of the market makes it vulnerable to manipulation by whale traders and large miners, citing known cases.
Overall, she believes that the SEC’s decision is not in the best interest of investors and their protection.
