A new revelation threatens to cast a shadow over the US Securities and Exchange Commission’s (SEC) handling of Bitcoin spot ETF applications, which are currently up for decision. The central question emerges: Is SEC chair Gary Gensler sharing an undisclosed affiliation with an organization opposing the spot Bitcoin ETF?
Castle Island Ventures General Partner Matt Walsh drew attention to an opposition letter on the Fidelity Bitcoin ETF proposal sent to the SEC by independent organization Better Markets, Inc. The contents of the letter have the potential to cause an uproar in the Bitcoin community. According to Walsh, the letter contains “questionable, if not outright false, claims about how the spot and futures markets for Bitcoin work today.”
Better Markets argued fervently against the proposed rule change to allow a spot ETF. Their assertion reads:
The spot Bitcoin markets have a history of artificially inflated trading volumes due to rampant manipulation and wash trading; are highly concentrated; and rely on a selected group of individuals and entities to maintain Bitcoin’s network.
Furthermore, Better Markets argues that the “CME Bitcoin futures market is not a regulated market of significant size and the surveillance-sharing agreements with Coinbase add little to no value.”
Anti-Bitcoin Spot ETF Letter Staged?
Yet what has truly captured the community’s attention isn’t just the content of the letter, but the seemingly intricate connections between the SEC, its chairman, and Better Markets. Walsh writes, “the letter comes off like it could have been written by Elizabeth Warren, Gary Gensler or Sherrod Brown, the leaders of the Anti-Crypto army. And guess who supports Better Markets?”
As Walsh found out, Gary Gensler has met with Better Markets nine times since he became SEC Chairman in 2021.” That is a level of access no-one in the digital asset markets, except for Sam Bankman-Fried has ever received.
Adding more intrigue, Justin Slaughter, Policy Director at Paradigm, pointed out: “The head of Better Markets was also selected by Chair Gensler to be on the Biden Transition team for finreg agencies.”
These revelations have sparked significant chatter among market experts. Eric Balchunas, Senior ETF Analyst for Bloomberg, remarked:
Good thread on relationship between Better Markets and Gensler and why politics is likely much more important than all the supposed legal aspects of this, unfortunately.
Also, there’s another reason to be suspicious. Both Gensler and anti-crypto Senator Elizabeth Warren have provided testimonials for Better Markets, as revealed on the organization’s website.
The gravity of these allegations is further intensified given the weight carried by the approval of a Bitcoin spot ETF. A Bitcoin spot ETF approval is widely viewed as a major catalyst for the market. With the SEC deadline on September 1 rapidly approaching, the market waits with bated breath for the commission’s decision regarding the spot ETF applications from financial giants BlackRock and Fidelity.
At press time, the BTC price was at $29,596.
