SEC Forced to Clarify Bitcoin ETF Rules After ‘Unauthorised’ X Post

The
agency
has
not
approved
any
spot
bitcoin
ETFs,
and
the
earlier
post,
now
deleted,
was
sent
by
an
unauthorised
user,
Gensler
said.

“The
SEC
has
not
approved
the
listing
and
trading
of
spot
bitcoin
exchange-traded
products,”
Gensler
said
on
X.

“The
unauthorised
tweet
regarding
bitcoin
ETFs
was
not
made
by
the
SEC
or
its
staff,”
a
spokesperson
at
the
SEC
confirmed
to
MarketWatch
via
email.

The
SEC
found
“there
was
unauthorised
access
to
and
activity
on”
the
agency’s
X
account
by
“an
unknown
party,”
an
agency
spokesperson
said,
adding
that
the
“unauthorised
access
has
been
terminated”
and
that
the
SEC
will
work
with
law
enforcement
to
investigate
the
matter.

Bitcoin’s
price
(BTCUSD)
briefly
shot
more
than
2%
higher
Tuesday
afternoon
after
the
unauthorised
post
went
out,
before
falling
back.
The
cryptocurrency
is
down
2.4%
over
the
past
24
hours
to
around
$45,840
(£36,007),
according
to
CoinDesk
data.

Cryptocurrencies
accounted
for
some
of
the

best-performing
ETFs
across
2023,
as
Morningstar
analysis
shows.

Crypto-market
participants
have
widely
anticipated
the
SEC
to
approve
a
spot
bitcoin
ETF
soon.
The
agency
has
until
January
10
to
make
a
decision
on
the
bitcoin
ETF
application,
which
had
been
filed
by

ARK
Investment
Management
and

21Shares.

Today,
both
BlackRock
and
Ark
Investment
Management
announced
fee
cuts
for
their
Bitcoin
ETF
proposals.
BlackRock
lowered
the
fee
on
its
iShares
ETF
by
five
basis
points
to
0.25%,
while
Ark’s
ETF
with
21Shares
will
be
listed
with
a
fee
of
0.21%,
according
to
Bloomberg.

The
agency
first
approved
a
bitcoin
futures
ETF
in
late
2021
but
has
not
approved
any
ETFs
investing
directly
in
the
cryptocurrency,
arguing
that
bitcoin
spot
markets
could
not
be
sufficiently
monitored
to
prevent
fraud
and
manipulation.

Last
August,
a
federal
judge
ruled
the
SEC’s
reasons
for
denying
an
application
by
Grayscale
Investments
to
list
a
bitcoin
spot
ETF
were
“arbitrary
and
capricious”
and
in
violation
of
federal
administrative
law.

The
judge
argued
the
SEC’s
decision
to
approve
two
bitcoin
futures
funds
but
to
deny
a
bitcoin
spot
fund
was
a
breach
of
the
principle
in
the
law
that
agencies
“must
treat
like
cases
alike”
because
prices
in
the
bitcoin
futures
market
closely
tracked
those
in
the
spot
market.

Commenting,
Susannah
Streeter,
head
of
money
and
markets
at
Hargreaves
Lansdown,
said
the
incident
had
brought
the
“pump
and
dump”
nature
of
crypto
scams
into
sharp
relief.

“Fans
have
been
holding
out
for
regulatory
approval
of
spot
Bitcoin
exchange
traded
funds,
and
fraudsters
have
clearly
used
this
desire
for
legitimacy
to
again
cheat
the
system,”
she
said.

“Investors
should
be
wary
of
trying
to
catch
a
ride
on
crypto
solely
on
these
moments
of
momentum,
particularly
given
the
highly
volatile
journey
that
crypto
has
been
on.

“The
events
of
the
past
24
hours
also
should
serve
as
a
warning
that
fraudsters
operating
pump
and
dump
schemes
are
numerous
in
the
crypto
wild
west
and
speculators
can
get
their
fingers
badly
burned.

“Globally
it’s
still
far
from
clear
what
the
regulatory
landscape
will
look
like
and
anyone
considering
speculating
in
crypto
should
still
proceed
with
caution,
use
money
they
can
afford
to
lose,
and
only
dabble
at
the
fringes
of
their
well-diversified
portfolios.”

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