SEC approves first bitcoin investment funds after false start
The Securities and Exchange Commission (SEC) approved nearly a dozen exchange-traded funds (ETFs) holding bitcoin on Wednesday, the first time the agency has permitted the trading of funds directly invested in a cryptocurrency.
The SEC approved 11 spot bitcoin ETFs from several major companies, including BlackRock, Fidelity and Grayscale Investments, as it faced down a deadline to rule on at least one of the applications.
“I feel the most sustainable path forward is to approve the listing and trading of these spot bitcoin ETP shares,” Gensler said in a statement.
However, he emphasized that the SEC's approvals on Wednesday are confined to ETFs holding bitcoin.
"It should in no way signal the Commission’s willingness to approve listing standards for crypto asset securities," Gensler said.
"Nor does the approval signal anything about the Commission’s views as to the status of other crypto assets under the federal securities laws or about the current state of non-compliance of certain crypto asset market participants with the federal securities laws," he continued.
The decision comes after the U.S. Court of Appeals for the District of Columbia ruled in August that the SEC improperly rejected Grayscale’s application for a spot bitcoin ETF. The agency has previously rejected all applications for such funds.
SEC Commissioner Hester Peirce, a Republican appointee who was an early supporter of the crypto industry, described the agency’s decision on Wednesday as the “end of an unnecessary, but consequential, saga.”
“More than ten years after the filing of the first spot bitcoin exchange-traded product ('ETP') application, the Commission finally has approved multiple applications by exchanges to allow the listing and trading of spot bitcoin ETPs,” Peirce said in a statement.
“This saga likely would have spanned well beyond a decade were it not for the DC Circuit-ex-machina,” she added.
House Financial Services Chairman Patrick McHenry (R-N.C.) and Rep. French Hill (R-Ark.), who chairs the Digital Assets, Financial Technology and Inclusion Subcommittee, called the spot bitcoin ETF approvals a “historic milestone for the future of the digital asset ecosystem.”
“While legislation to provide clarity and certainty for digital assets remains necessary, the steps taken today are a significant improvement over the SEC’s track record of regulation by enforcement,” they said in a statement.
“We are pleased that investors and our markets will finally be afforded greater access to this generational technology,” McHenry and Hill added.
The long-awaited decision comes after the SEC’s account on X, formerly Twitter, was hacked Tuesday and sparked confusion by falsely announcing the approval of the spot bitcoin ETFs.
The fake announcement was online for about 30 minutes before it was removed and replaced with a disavowal by the agency.
“The @SECGov X account was compromised, and an unauthorized post was posted. The SEC has not approved the listing and trading of spot bitcoin exchange-traded products,” the agency wrote in a Tuesday afternoon post.