The U.S. Securities and Exchange Commission (SEC) approved on Wednesday the first U.S.-listed exchange-traded funds (ETFs) to track bitcoin. Experts described it as a watershed moment for both the world’s largest cryptocurrency and the broader crypto industry.
The announcement follows a turbulent 24 hours for the decentralized digital currency. A post on X, published on the SEC account Tuesday, announced the approval of the long-awaited ETFs. This caused bitcoin’s price to surge by more than $1,000. Shortly thereafter, the SEC declared that its account had been “compromised” and the post was “unauthorized.”
However, on Wednesday, the SEC did approve the ETFs—this time legitimately—while maintaining a skeptical stance on cryptocurrency.
“Today, the Commission approved the listing and trading of a number of spot bitcoin exchange-traded product (ETP) shares,” SEC Chair Gary Gensler said in a statement on Wednesday.
Although investors can currently buy and sell bitcoin, or gain exposure through brokerage firms, mutual funds, national securities exchanges, peer-to-peer payment apps, and non-compliant crypto-trading platforms, today’s action will introduce certain protections for investors, he explained.
The ETFs, in development for nearly a decade, are a game-changer for bitcoin. They offer investors exposure to the world’s largest cryptocurrency without the need to own bitcoin directly.
In its registration statement, for instance, BlackRock itself warns that: “There is no assurance that bitcoin will maintain its value in the long, intermediate, short, or any other term. In the event that the price of bitcoin declines, [BlackRock] expects the value of the shares to decline proportionately.”
However, the majority of the ETFs will start trading on Thursday, initiating competition for market share, according to reports.
“The readiness of the sector to list these ETFs and the commitment of the broader market to continue the growth momentum, highlight the industry’s confidence in regulatory decisions,” Mr. Pagidipati told The Epoch Times. “[The] SEC’s approval further adds [to the] optimism.”
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