SEC commissioner Hester Peirce says regulator’s bitcoin-ETF requirements are excessive

The U.S. Securities and Exchange Commission (SEC) would have approved long ago exchange-traded products (ETPs) based on the leading cryptocurrency, applying the standard approach to their review. That was the view expressed by Commissioner Hester Peirce in an interview with CNBC.

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“I think if we applied our standards in the same way as for other products, we would have approved one or more of them. With each day, the justification we used in the past to deny approval seems to be getting weaker,” she said.

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The question of when the regulator will approve a bitcoin-ETF, Peirce said, is the “most important and frequently asked” question she receives.

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She explained that the Commission’s tougher requirements for such products reflect the digital-gold market’s departure from regulators’ usual remit.

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However, with rising institutional investment in the leading cryptocurrency, the sector is increasingly resembling the established incumbents, Peirce noted.

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The commissioner also highlighted the danger of delaying approval for bitcoin-based exchange-traded products. In her view, investor interest would compel them to seek an alternative that could prove riskier.

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In February 2021, Peirce said US capital markets were ready for ETPs based on the leading cryptocurrency.

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As reported in June, the SEC postponed consideration of bitcoin ETF applications from Kryptoin Investment Advisor and Valkyrie.

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In the same month, a joint proposal to launch such a product submitted for regulator approval by asset manager ARK Invest and the cryptocurrency ETP provider 21Shares.

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