Timothy Massad was the Chair of the United States Commodity Futures Trading Commission from 2014 to 2017. He has explained why he believes regulators should approve a Bitcoin-exchange-traded fund.
Massad published an opinion piece on Bloomberg Wednesday in which he suggested that the Securities and Exchange Commission (or SEC) should approve a Bitcoin Exchange Traded Fund (ETF) in a way that would increase transparency and integrity within the emerging cryptocurrency industry. Investors can now access the digital asset directly from their computers without needing to purchase it on exchanges or worry about being held in custody.
Massad stated that the best path to approve a Bitcoin ETF would be one that has a stronger regulatory framework. He acknowledged that it is unlikely that this will happen in the near future. Massad described U.S. Crypto regulations in a February interview to Cointelegraph as "swiss cheese" or full of holes.
Massad believes that the SEC could use the ETF listing process in order to increase the integrity of cryptocurrency exchanges in the absence of comprehensive regulations.
He wrote that approval would be granted if the ETF price is based on an exchange index meeting prescribed standards similar to those used for securities and derivatives.
Due to concerns about liquidity, transparency, and price manipulation, U.S. securities regulators were reluctant to approve a Bitcoin ETF. A number of ETFs were submitted to the SEC. Each one was sent back to issuers for review. A few applications are currently being reviewed by the SEC. VanEck, an asset manager, has submitted a prospectus to the SEC.
Todd Rosenbluth (a subject matter expert) says that Bitcoin ETF approval will take at least one year. CNBC was informed by CFRA's head of ETF research and mutual fund research in April that it is unlikely that regulators will approve an ETF in the near-term.
Canada has approved several Bitcoin ETFs. Early trends suggest that they are very popular north of the border. Despite the dramatic drop in Bitcoin prices since May, the Purpose Bitcoin ETF continues its appeal to investors.