Dennis M. Kelleher, the CEO of the nonprofit organization Better Markets, has strongly urged the U.S. Securities and Exchange Commission (SEC) to refrain from approving a spot Bitcoin exchange-traded fund (ETF), asserting that such an action would contradict the SEC's fundamental principles. In a letter addressed to SEC Secretary Vanessa Countryman on January 5, Kelleher underscored the potential risks the approval might pose to investors, highlighting that granting approval could lead to severe consequences:
"This supplemental comment letter, a rare submission from Better Markets, is crucial because the approval of the pending rule changes could become a significant, even historic, error resulting in extensive harm to investors." Kelleher is concerned that the proposed product could expose investors to potential fraud, a persistent worry within the cryptocurrency industry since its inception.
According to Kelleher, greenlighting these spot Bitcoin ETPs (Exchange Traded Products) would not only subject investors to a market rife with fraud and manipulation but could also have broader implications.
Additionally, Kelleher raised concerns that approving such ETFs would inadvertently lend a sense of legitimacy to the crypto industry, potentially allowing them to claim U.S. government approval for their products. Nevertheless, prominent figures in the cryptocurrency realm dismissed Kelleher's letter. Bloomberg ETF analyst James Seyffart criticized the letter's viewpoint on social media, highlighting the substantial effort made by the asset manager in advancing its app.
On a separate note, Fox Business reporter Eleanor Terrett reiterated Kelleher's recent negative comments about cryptocurrencies in another post on X (formerly Twitter). She recalled Kelleher's statements made in a May 2023 interview with the Institute for New Economic Thinking, describing them as misleading and harmful to the public. The latest development revealed that 11 applicants for spot Bitcoin ETFs submitted revised Form 19b-4 before the deadline on January 5. These forms represent one of the crucial stages in the SEC approval process, although completion of the S-1 filing is essential before U.S. exchanges can list shares of investment securities with direct cryptocurrency exposure.
