Grayscale chief calls approval of spot Bitcoin ETF ‘the next logical step’ for the SEC

Approval of the SEC exchange-traded fund (ETF) based on short positions in Bitcoin futures is a positive signal for the crypto industry. This view was voiced by Grayscale Investments CEO Michael Sonnenshein.

Approval of an ETF that provides inverse exposure to #Bitcoin futures could be a positive sign for #crypto. Here’s a 🧵 on why…

— Sonnenshein (@Sonnenshein) June 21, 2022

On Tuesday, June 21, trading of ProShares Short Bitcoin Strategy ETF (ticker BITI) began, allowing investors to profit from declines in the price of the first cryptocurrency.

“I am convinced that approving every Bitcoin-related investment product demonstrates increased comfort by the SEC with BTC and cryptocurrencies in a broader sense,” Sonnenshein wrote.

This also applies to the ProShares ETF, despite its inverse exposure to the asset’s price, he believes.

In his view, by rejecting spot Bitcoin ETFs, the regulator cites concerns about the ‘maturity of the underlying markets’ and potential ‘fraud and manipulation’.

“How else can the entry of BITI into the market be interpreted other than further recognition by the SEC of Bitcoin’s maturity,” Sonnenshein noted.

In his view, the appearance of the ProShares fund signals that the regulator regards the cryptocurrency derivatives market as robust enough to offer short positions to retail investors.

“Wouldn’t approval of a spot Bitcoin ETF be the next logical step?” Sonnenshein asked.

In October 2021, Grayscale filed a request to convert its Bitcoin Trust GBTC into a spot-price Bitcoin ETF. Regulators must decide by July 6.

In March, Sonnenshein allowed for the possibility of filing a lawsuit against the SEC in the event of a denial.

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