The Financial Services Committee of the U.S. House of Representatives has sent a letter to urge Securities and Exchange Commission Chair Gary Gensler to authorize outstanding spot Bitcoin ETF applications immediately.
On Tuesday, the Financial Services Committee urged the SEC to submit to the court’s demands by approving spot Bitcoin ETF. Out of the four members, Emmer, Flood, and Torres are part of the Congressional Blockchain Caucus.
Due to the simplicity of ETF for investment purposes, investors and enthusiasts continue to rally for its approval. However, the SEC has yet to give its approvals to pending ETF proposals, arguing that the cryptocurrency landscape and lack of transparency are unpredictable.
🚨NEW: A bipartisan letter sent to @GaryGensler by GOP members @GOPMajorityWhip and @USRepMikeFlood, and Democrats @RitchieTorres and @RepWileyNickel urging the @SECGov to approve a $BTC Spot ETF. 👇🏼 pic.twitter.com/7ygTYWIPyu
— Eleanor Terrett (@EleanorTerrett) September 26, 2023
Committee, judge push for approval
Grayscale Investments’ lawsuit victory over the SEC has prompted the committee to further push for authorization. It claimed that all Spot Bitcoin ETFs were “indistinguishable” and the delay from the SEC was “discriminatory” to spot Bitcoin ETFs.
Prior to the trial, Grayscale Investments’ application to convert their Bitcoin products into ETF had been denied. Circuit Judge Neomi Rao wrote that the SEC’s initial dismissal of Grayscale’s proposal was “arbitrary and capricious,” adding that the agency’s reasons for denying ETF applications are indefensible.From the committee itself, Torres wrote that he intended “to ensure the [SEC] does not continue to discriminate against spot bitcoins [ETFs].”
“Following the Court of Appeals’ decision, there is no reason to continue to deny such applications under inconsistent and discriminatory standards,” the letter from the committee reads.
The SEC is presently blocking proposals from major financial firms such as Fidelity, Invesco, and WisdomTree, drawing criticisms due to inconsistencies as the agency has previously approved Bitcoin Future ETFs under an arrangement with the Chicago Mercantile Exchange.
The SEC’s concerns in regard to the Bitcoin markets have been dismissed by the U.S. Court of Appeals, with the court saying that the agency’s concerns still cannot justify its obstruction of ETF applications.
Gensler criticizes crypto in congressional hearing
SEC Chair Gary Gensler testified before the House Financial Services Committee on Wednesday, where he continued his combative stance against the crypto industry.
Gensler criticized how crypto companies manage customer assets, saying that commingling assets is a recipe for disaster. He also said that the SEC was still considering what to do about a judge’s ruling that sent the agency back to the drawing board on its spot Bitcoin ETF position.
“It’s still an active consideration of the commission,” Gensler said in his testimony. “We have great respect for the courts.”
Gensler also reaffirmed that Bitcoin is “not a security.” He declined to answer questions about the SEC’s other high-profile legal dispute in its case against Ripple or the ongoing accusations against Binance.
What the SEC will do to outstanding spot Bitcoin ETF applications remains to be seen, but the agency is under increasing pressure from the industry and the courts to reconsider its stance on Bitcoin ETF applications.
“It’s time for you to consider the lasting consequences your actions have on the SEC’s reputation,” Financial Services Committee Chairman Patrick McHenry told Gensler.
“While your time in this role may be temporary, the repercussions of your actions may be permanent for the agency.”