Timothy Massad, former chairman of the US Commodity Futures Trading Commission (CFTC), has urged the U.S Securities and Exchange Commission (SEC) to approve a Bitcoin exchange-traded fund (ETF).
Massad made his points known in a Bloomberg opinion piece. He said the SEC should look into approving an ETF in a way that would enhance transparency and integrity in the industry.
Bitcoin ETF Would Be Good For Retail Investors
Massad said a Bitcoin ETF would help retail investors invest in digital assets without purchasing them and dealing with the complexities of custody.
He said that while it would be best to have crypto regulations in place before approving a Bitcoin ETF, this may not happen soon. This is why Massad thinks a conditional approval would be best to increase the industry’s transparency, integrity, and investor protection, not just its mass appeal. Massad said,
“Although it would be best to see such ETFs approved only after Congress has strengthened crypto regulation generally, the likelihood of that happening in the near future is low.”
While cryptocurrency exchanges are largely unregulated in the U.S, the former CFTC chair said the SEC could use the ETF listing process to improve the integrity of cryptocurrency exchanges in the absence of comprehensive regulations.
He added that the ETF approval could be granted on the condition that the ETF prices are based on an index of exchanges meeting certain prescribed standards.
Massad’s comments follow similar comments attributed to SEC Commissioner Hester Peirce, who argued that a Bitcoin ETF should have been approved a long time ago.
In an interview with CNBC, Peirce said that she sees the SEC using double standards in approving crypto products. According to her, the SEC applies a heightened standard in filings associated with cryptocurrencies, unlike the standards it uses for traditional, equity-based products.
SEC’s Continuous Delay In Approving ETFs
Over the years, there have been several applications for a Bitcoin ETF, but the SEC is yet to approve any of the applications.
The regulator had previously cited concerns like fraud, market manipulation, and volatility as the reasons behind the rejections or delays.
The latest application facing delay by the SEC is Anthony Scarammuci’s SkyBridge Capital’s application for a Bitcoin ETF. A filing by the regulator shows that the application submitted on May 6 has been extended for 45 days ending in August.
The SEC is currently reviewing many applications and has invited public comment on the Bitcoin ETF filed by asset manager VanEck. The review process has also been extended until August 2021.