Former attorney in the Securities and Exchange Commission (SEC) ruled out the likelihood of the Garry Gensler-led agency approving the pending applications for bitcoin spot exchange-traded fund (ETF). John Reed ruled out SEC relenting of the Democrat-affiliated stance against crypto.
Reed acknowledged that only a Republican-led administration after 2024 would approve the ETF applications. He added that SEC would, after 2024, portray a pro-crypto stance to roll back the firm enforcements criticized by the pro-crypto parties.
Reed admitted that despite the filings submitted by the reputable Wall Street asset management firms, SEC is unlikely to ease its opposition to the ETFs. He considered that the current composition of SEC would unlikely abandon the Democrat’s crypto position.
SEC Likely to Affiliate With Better Markets Letter
The former head of SEC’s Office of Internet Enforcement revealed in a Sunday, August 13 tweet that the current SEC executive would likely reaffirm their position to disapprove the pending bitcoin spot ETF applications. Reed backed his argument through a reference to a comment letter penned to SEC. The letter by Washington-headquartered Better Markets urged the securities watchdog to dismiss the proposed rule change poised to facilitate listing shares from the Bitcoin ETFs.
The open letter published on the Better Markets blog on Wednesday, August 9, portrayed Bitcoin ETFs as vulnerable to exposing US investors to fraud and manipulation. The letter warned SEC against relenting on its position to dismiss the Bitcoin spot ETF applications.
Better Markets’ letter revisited its previous trend of frequently supporting the SEC’s approach to regulating the crypto industry. Reed observed that the comment letter echoed the previous stances by SEC against spot ETF. In particular, the letter argued that Bitcoin markets are susceptible to manipulation. The network relies on a few entities and individuals to maintain the lead crypto.
The letter supports SEC’s move to block applications for the ETF that date back to 2013. Reed decries the decision given that SEC recently approved ETFs within Bitcoin futures markets.
Reed revisited the bold move by BlackRock to pursue spot ETF in June. He confessed that the move prompted other asset management firms alongside Bitwise, including VanEck, Wisdom Tree, Invesco, and Fidelity.
SEC’s Stance Against Crypto Bound to Change After 2024 Election
Reed predicted in his Sunday tweet that SEC crypto regulation would likely change after the 2024 presidential election. He hypothesized that the SEC’s future handling of crypto would likely change in the event of a Republican win in the upcoming presidential election.
Reed indicated that the GOP-led administration would likely implement a friendlier crypto stance. He believes the Republican administration would approve spot ETFs. The attorney added that the multiple enforcement actions in the Gensler-led crypto crackdown would grind to a halt.
The Sunday Twitter thread by Reed shows a departure from his anti-crypto stance. Often, his arguments have riled up many parties within the digital asset community. He indicated that a Republican majority in the agency’s executive would engineer repeal of the enforcement actions undertaken during Biden’s administration.
Reed’s admission of bound changes if a Republican wins the vote departs from the harsh criticism of the digital assets’ ecosystem. In addition, he has engaged in public arguments with executives of key firms.
Attorney Reed Engages in Public Spat with Tether’s CTO
In May 2023, Reed triggered a back-and-forth conversation with Tether’s chief technical executive Paolo Ardoino. The heated debate arose from Reed’s criticism of the USDT stablecoin issuer, citing opaque financial statements and the absence of regulations.
While Reed admitted the defenses offered by Ardoino, he termed stablecoins as conduits of illicit finance. He indicated that they benefit the grifters and criminals within the developed world.
Reed would, in June, question blockchain’s viability. He argued that the technology supporting cryptocurrency infrastructure is unviable. The remark sparked a hot contest involving crypto investor Mark Cuban in the digital assets industry defense.
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