Hester Peirce, a U.S. Securities and Exchange [SEC] commissioner, explained her stance on the Bitcoin ETF proposed by the Winklevoss brothers, in an interview with Laura Shin for Unchained.
In July 2018, the SEC made headlines after rejecting a rule change proposal, which would have allowed trading of an exchange-traded fund. The commission rejected the proposal on the grounds that the ETF was not designed to prevent manipulative and fraudulent activities.
However, this reason was not accepted by Hester Peirce, resulting in public dissent. The commissioner had stated that the ETF satisfied the regulatory and statutory standards set by regulatory bodies.
On the issue, Hester Peirce said that the SEC “had been looking at this issue for a long time,” adding that she was “pretty uncomfortable” with the “rationale” guiding the commission’s decision on the ETF.
“I thought that in looking at our statutory authority and then looking at kind of the rationale that we had for rejecting the ETF, which was which was essentially to look at the underlying markets and say, ‘oh the underlying markets make us uncomfortable and so we’re not going to approve a product that trades in our securities markets.”
She added that there could be several other areas that would make the commission uncomfortable if they actually started to look at the underlying market. She further said,
“[…] but I did think there was a whiff of merit regulation in this, which was essentially us saying we don’t think this product would be good for investors. I don’t know whether […] exchange-traded product based on cryptocurrency would be good for investors but I think the investors can make the decision better than I can”
Peirce concluded by stating that the decision of whether an ETF was good or bad for investors can be made by only the investors themselves. She further stated that the SEC should let the market “try it out” and see “what the market thinks.” She said,
“[…] and sometimes things that are really fought. long and hard for buy by people in this space you know they finally get it to market and it totally falls flat that’s just the way it is but that should be the market’s decision, not ours. […]”
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