U.S. Securities and Exchange Commission (SEC) Chair Gary Gensler sees irony in the approval of spot bitcoin exchange-traded funds (ETFs). “This was about centralization and traditional means of finance,” said Gensler, warning: “Investors should be aware that this underlying asset is a highly speculative, volatile asset, and amongst its use cases is really for illicit activity, money laundering, sanctions, ransomware, and the like.”
SEC Chair on Spot Bitcoin ETF Approval and Centralization
The chairman of the U.S. Securities and Exchange Commission (SEC), Gary Gensler, discussed the irony of spot bitcoin exchange-traded funds (ETFs) in an interview with CNBC Friday. The securities regulator approved 11 spot bitcoin ETFs last week.
“There’s an irony in the midst of that. Satoshi Nakamoto [bitcoin’s pseudonymous creator] said this was going to be a decentralized system,” Gensler said, noting that the approval of spot bitcoin ETFs “has led to centralization.” The SEC chief stressed:
Think about the irony of those who say this week is historic. This was about centralization and traditional means of finance.
He added: “Investors could already express themselves in bitcoin. You could already, before this week, buy it through major brokerage houses, but now you can buy it through this thing called an exchange-traded product as well, centralized,” he noted. “There’s a lot of centralization here.”
The securities regulator approved 11 spot bitcoin ETFs last week. Although Gensler was the deciding vote approving the 11 funds, the SEC chairman clarified that the approval was not an endorsement of bitcoin.
Gensler clarified: “Bitcoin itself, we did not approve, we did not endorse. This is a product called an exchange-traded product, a way that investors can invest in that underlying non-security commodity called bitcoin.” The SEC chairman proceeded to warn:
Investors should be aware that this underlying asset is a highly speculative, volatile asset, and amongst its use cases is really for illicit activity, money laundering, sanctions, ransomware, and the like.
“It is a speculative value store of value,” he continued. “Is it being used as a payment anywhere? Are we buying cups of coffee with it? Not really. The only payment mechanism it’s being used for in a primary sense is illicit activity.”
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