The Securities and Exchange Commission (SEC) has officially delayed the approval of Global X’s Spot Bitcoin ETF, citing “serious concerns about BTC price manipulation and fraud.” The regulatory body has put the approval process on hold, demanding answers to a series of crucial questions from the firm. This delay is likely to result in a denial when the SEC makes its final decision in January 2024.
Interestingly, BlackRock’s application for a similar product does not seem to be under the same scrutiny. Despite operating in the same market, the SEC has not emphasized the need for detailed answers from BlackRock.
The concerns raised by the SEC echo past rejections of spot ETFs, indicating that the issues surrounding price manipulation have persisted and, if anything, worsened over the years.
The SEC’s hesitation regarding Bitcoin spot ETFs is rooted in the fear of price manipulation and fraudulent activities within the cryptocurrency market. While these concerns are not unique to the crypto space, they play a significant role in the SEC’s decision-making process.
The SEC’s stance implies that if any BTC spot ETF application is approved on January 10, the regulatory body will have to greenlight all pending applications simultaneously. This approach aims to ensure fairness among all applicants and provide them with equal market opportunities.
Critics argue that the SEC’s focus on BTC price manipulation is somewhat myopic, given that manipulation exists in other financial markets as well. The question of whether the SEC’s stringent scrutiny is justified or if it creates an undue barrier for cryptocurrency-related financial products remains a topic of heated debate.
