On January 10, 2023, U.S. Securities and Exchange Commission (SEC) approved 11 spot bitcoin exchange-traded funds (ETFs) , marking a historic moment for the cryptocurrency industry.
However, SEC Chair Gary Gensler reiterated in a statement a few hours later that the agency still does not endorse bitcoin.Â
Gensler contrasted bitcoin’s “speculative” nature with the utility of precious metals like gold and silver. He stated the SEC remains “merit neutral” and does not favor particular investments or assets underlying exchange-traded products.
Despite this claim of neutrality, Gensler specifically mentioned bitcoin is frequently used for illicit financing like ransomware, money laundering, and terrorist financing.
While evidence suggests this perception of rampant criminal bitcoin use is outdated, Gensler maintained the SEC’s cautious stance. He advised investors to be wary of the “risks associated with bitcoin and products whose value is tied to crypto.”
The statement aligns with the SEC’s view that most cryptocurrencies are investment contracts falling under its regulatory jurisdiction.
Though historic, the ETF approvals did not indicate an SEC endorsement of bitcoin. Gensler reiterated bitcoin’s speculative, volatile nature and association with criminal activity while advising investor caution regarding crypto-linked investments.
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