As the wait for the first U.S.-based spot exchange-traded fund (ETF) for Bitcoin continues, former SEC Chair Jay Clayton has reiterated his conviction that it is only a matter of time until such a product arrives. Jay Clayton served as the SEC Chair between May 2017 and December 2020 before being replaced by acting chair Allison Lee and then permanently by current chairman Gary Gensler.
During his stint as SEC Chair, Jay Clayton and the commission declined several spot Bitcoin ETF applications. The SEC cited fraudulent manipulation of the global Bitcoin spot market as one of its reasons for denying earlier applications, something that Clayton now believes has improved in the past three to four years.
Speaking in a recent CNBC interview, the former SEC Chair argued that the commission had decided on every legal question around Bitcoin, namely that it is a commodity and not a security. “That would make you think that a Bitcoin spot ETF is inevitable,” Clayton added.
"We've decided every legal question around #Bitcoin. The $BTC spot market has much greater efficacy than it did," says Fmr. SEC Chair Jay Clayton. "#Crypto is a technology. Let's see that technology in our financial ecosystem. I believe that stablecoin is one of those places." pic.twitter.com/hpn7gJx5di
— Squawk Box (@SquawkCNBC) October 3, 2023
Bitcoin Spot Market Has “Greater Efficacy”
According to the former SEC Chair, his primary concern, which led to the denial of Bitcoin ETF applications during his regime, was that a lot of fraud was going on with spot Bitcoin trading, especially on offshore trading platforms.
He told CNBC, “I was very concerned that the trading of Bitcoin around the globe on exchanges that we had no insight into had a large amount of fraud going on, and I was not comfortable, and the staff at the SEC was not comfortable.”
However, Jay Clayton argues that the landscape has changed, and many market surveillance experts are now increasingly confident that “the Bitcoin spot market has much greater efficacy than it did three or four years ago.”
Jay Clayton further argued that the current batch of Bitcoin ETF applicants includes well-respected firms and institutions (and apparent allusion to BlackRock’s ETF filing). These firms, and even newer financial institutions vying for a spot Bitcoin ETF, have also laid out a case for why trading in spot Bitcoin is more efficient,” per the former SEC Chair.
Notably, the SEC Chair is not the only one backing the imminent arrival of a spot Bitcoin ETF. As Coinfomania reported, leading Bloomberg analysts also believe the SEC will eventually be forced to approve a Bitcoin ETF sooner rather than later.
