The non-partisan nonprofit Better Markets has submitted a comment letter to the Securities and Exchange Commission (SEC). This move comes as a stance against several pending applications for a Bitcoin-trading Exchange-Traded Fund (ETF). Better Markets, known for advocating stringent financial regulations, highlights the risks associated with such financial products.
Kelleher’s concerns with Bitcoin ETF
Dennis M. Kelleher, CEO and co-founder of Better Markets, outlined significant concerns regarding approving a spot Bitcoin ETF in the letter. He emphasized the potential risks it poses to American investors and retirees. Kelleher’s argument centers around the speculative and volatile nature of Bitcoin, which he deems as “socially useless” for the financial market.
One of Kelleher’s primary arguments is the immaturity of the Bitcoin market, which he believes is not ready for an ETF. He points out issues like wash trading and the concentration of Bitcoin holdings among a limited number of owners. Furthermore, Kelleher argues that the volatility of Bitcoin is a disqualifying factor for offering it to investors. He expresses concern that the approval of spot Bitcoin ETFs could lead to a regulatory error with lasting consequences.
Better Markets: A persistent critic of crypto expansion
Better Markets has a history of advocating for increased financial regulation, particularly on Wall Street. The organization, often aligning with figures like President Barack Obama and Senator Elizabeth Warren, has been a vocal critic of the cryptocurrency industry’s regulatory expansion. In 2022, it spent a total of $3 million on various initiatives, as reported in its annual report.
The organization once notably rejected a $1 million donation from FTX, perceived as a direct quid pro quo in exchange for support in an application to the CFTC. This incident underscores Better Markets’ commitment to its principles and steadfast position against certain aspects of the crypto industry.
The letter from Better Markets to the SEC underscores the ongoing debate over integrating cryptocurrencies into mainstream financial products. While crypto proponents see ETFs as a significant step towards mainstream acceptance, critics like Better Markets caution against the risks and the potential impact on investors and the broader financial system.
