Congressmen Emmer and Soto want the SEC to approve a Bitcoin ETF in the spot market

Representatives Tom Emmer (R-MN) and Darren Soto (D-FL), two of the most active leaders of the Congressional Blockchain Caucus, today sent a letter to the Chairman of the Securities and Exchange Commission, Gary Gensler, on an issue. in the minds of all investors. CRYPTOCURRENCY.

Your question: why don’t we have one? Bitcoin ETF?

“We wonder why, if you are comfortable allowing trading an ETF based on derivative contracts, you are not equally or more comfortable allowing ETF-based trading on the Bitcoin ground,” Members of Congress wrote. “Bitcoin Spot ETFs are directly dependent on the asset, which inherently provides greater protection to investors.”

ETFs are investment products that track the price of one or more assets. Retail investors can integrate ETFs into their savings and retirement portfolios to gain exposure to the prices of various stocks and bonds. A Bitcoin ETF would allow people who do not want to buy and hold Bitcoin themselves about to act again; Instead of buying BTC on a cryptocurrency exchange, they could buy and trade it on the exchange.

But Bitcoin futures ETFs are not that. y track the price of investment contracts that speculate on the incoming price of BTC. All in all, a more complicated undertaking for the average American, and one that Emmer and Soto believe may be more volatile and expensive.

However, last month, the SEC, which for years rejected applications for a Bitcoin ETF, stepped aside to allow trading in Bitcoin futures ETFs. Gensler had indicated in August that he expected to see such applications, which would be included in the Investment Company Act of 1940. “When combined with other federal securities laws,” Gensler said in the August speech that sparked the mad rush to deposit ETFs. In cryptocurrency futures, “the law of the 1940s provides significant protection for investors.”

That decision was apparently made due to the possibility that Bitcoin spot prices were manipulated or vulnerable to fraud. But Emmer and Soto point out that any fraud or manipulation in the spot markets would necessarily result in Bitcoin derivatives. According to the representatives, “90.47% of the price of the CME CF Bitcoin Reference Rate (BRR), which is the price index used by ETFs based on CME futures, is made up of Bitcoin spot exchanges: Coinbase, Kraken, and Bitstamp. . “If spot markets are bad, so will derivatives markets,” they suggest.

Members of Congress insist they are not taking a position, they are simply not accepting Gensler’s argument that derivatives are safer. y concluded that “unless there are clear and demonstrable benefits for investor protection, investors should have the ability to choose which product best suits them and their investment objectives.”

Also read Why did Bitcoin, Ethereum and Dogecoin increase this week?

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