After a saga full of twists and turns, the US Security and Exchange Commission (SEC) has finally approved Bitcoin ETFs. The U.S. financial watchdog continues to severely criticize Bitcoin. The announcement of the approval of Bitcoin ETFs has made some happy, but also some unhappy, chief among them… GreenPeace.
SEC finally approves Bitcoin ETFs
The wait has been long, tumultuous and full of twists and turns right up to the last minute. It’s now official: the Security and Exchange Commission (SEC) has finally approved Bitcoin ETFs. The chairman of the SEC Gary Gensler himself what announced it in a statement published on January 10. This measure paves the way for investment in Bitcoin via mutual funds.
Today, the Commission approved the listing and trading of a number of spot bitcoin exchange-traded product (ETP) shares.
Gary Gensler.
In the past, the SEC had always systematically rejected Bitcoin Spot ETF applications. Aggrieved by this rejection, the Grayscale went to court in the U.S. in 2022 to oppose the order of the SEC. Last August, the U.S. Court of Appeals for the District of Columbia found that the rejection of the Bitcoin ETF by the SEC was arbitrary and unjustified. This ruling, as well as requests from financial giants such as BlackRock were instrumental in changing the decision of the SEC.
Yes to Bitcoin ETFs, not to Bitcoin
Although the SEC approves Bitcoin ETFs, its chairman Gary Gensler remains a fervent Bitcoin critic. In the statement of approval for Bitcoin ETFs, the president of the SEC reminds us that Bitcoin is neither approved nor endorsed by the SEC. For Gary Gensler, Bitcoin is an asset to be avoided because it is speculative and highly volatile. Furthermore, the SEC chairman believes that the queen of cryptocurrencies is also being used for illegal purposes.
While we approved the listing and trading of certain spot bitcoin ETP shares today, we did not approve or endorse bitcoin. Investors should remain cautious about the myriad risks associated with bitcoin and products whose value is tied to crypto.
Gary Gensler.
Aware of “these risks associated with Bitcoin”, the SEC has taken certain steps to protect investors in Bitcoin ETFs. These include The SEC requiring all Bitcoin ETF managers to provide full, fair and truthful disclosure to potential investors. Furthermore, approved Bitcoin ETFs will be listed and traded on duly registered exchanges in the USA.
Some happy, some unhappy, following the approval of Bitcoin ETFs.
The approval of Bitcoin ETFs was eagerly awaited by players in the crypto ecosystem. The crypto market was the first to react. While Bitcoin didn’t move too much, Ethereum (ETH) and several altcoins took a significant leap forward. Several crypto players also expressed their delight at the approval of Bitcoin ETFs. The exchange Coinbase which is partnered with 8 of the 11 approved Bitcoin ETFs, has welcomed “a watershed moment for the expansion of the crypto economy”. The platform hopes that Bitcoin ETFs will bring new investors into the sector to drive long-term growth and innovation.
Some of the companies whose Bitcoin ETFs have been approved have also reiterated their commitment to supporting the Bitcoin sector. These include Bitwise which promises to donate 10% of the profits from its Bitcoin ETF to three organizations funding the open source development of Bitcoin worldwide. These organizations are Brink, OpenSats and the Human Rights Foundation (HRF) with its Bitcoin Development Fund. Shortly before Bitwise, VanEck had promised to donate 5% of the profits of its Bitcoin ETF to the developers of Bitcoin Core.
The approval of Bitcoin ETFs has not made everyone happy. In a statement dated January 10, GreenPeace USA has deemed the approval of Bitcoin EFTs a failure for the climate. For this environmentalist organization, Bitcoin mining uses electricity produced mainly from fossil fuels. So the strong adoption of Bitcoin that will result from the approval of Bitcoin ETFs will lead to more carbon emissions, believes GreenPeace.
The NGO’s pessimistic predictions are based on false premises. Several studies reveal that Bitcoin mining is done with renewable energy. In addition, mining makes it possible to finance green energy and the environmental conservation. GreenPeace should therefore review its analysis grid on the ecological impact of Bitcoin.
Conclusion
Long-awaited for several months, the approval of Bitcoin ETFs is now a reality. Although it is difficult to quantify the impact this approval will have on the Bitcoin price, it is clear that this step further legitimizes Bitcoin as an asset. In just 15 years of existence, Satoshi Nakamoto’s invention has managed to impose itself on the American financial regulator. The future is bright for Bitcoin, the queen of cryptocurrencies.
I dream of a world where every citizen has total control over themselves, including their finances. I believe that Bitcoin is one of the tools that will achieve this revolution. Since 2019, I am learning about this cryptocurrency and spreading the word around.
