In spite of the potential approval of Ethereum exchange-traded funds (ETFs) by the US Securities and Exchange Commission (SEC), Gary Gensler, the president of the agency, remains firm in his stance on cryptocurrencies. Ahead of the decision on the ETFs, Gensler reiterated that most cryptocurrencies are securities. He stated that these tokens, which number in the thousands, do not function as currency and are typically invested in based on the group of entrepreneurs behind them, making them fit the classic definition of a security. Gensler emphasized that while not all cryptographic tokens are securities, he believes that most of them are.
In a bipartisan move, US lawmakers, including members of the House Financial Services Committee, have urged the SEC to consider approving spot Ethereum ETFs. They argue that the recent approval of spot Bitcoin ETFs by the SEC sets a precedent and approving Ethereum ETFs would be a natural progression. This would demonstrate consistency in the application of SEC standards and affirm the legal reasoning behind the approval of spot Bitcoin ETPs. The lawmakers highlight the importance of consistent regulation in the cryptocurrency market.
It is important to note that Gary Gensler has expressed concerns about the proposed law FIT21, citing potential regulatory gaps and risks for investors and markets. While the Biden administration opposes the bill, it does not plan to veto it, indicating a divergence in the US government’s stance on cryptocurrency regulation. The bill was approved by the Chamber on May 22.