Did the SEC Reject Bitcoin ETFs Because of “Appearance”?

SEC


Bill Taylor/ Fintek Capital

Well, has the SEC (Security & Exchange Commission) gone to profiling in the application process for a bitcoin ETF? Is appearance and demeanor now a factor in the how the SEC staff considers applications? No one gets a new product through this agency until they check the label on your clothes, make sure you have brushed your teeth and can curtsy appropriately to the staff? Sadly, wouldn’t be a bit surprised.

So, what brought this up? As everyone is now fully aware, the SEC recently rejected several applications for bitcoin ETFs and a former Goldman Sachs guy (Bill Barhydt), who founded bitcoin payment startup (Abra), has a theory as to why that may be. The people making the applications just “don’t fit the mold” of who the SEC is used to dealing with. OH ‘sniff sniff’. Probably wearing white after Labor day, too.

Now, I believe there may be a bit of truth in that. For certain the SEC just doesn’t like bitcoin and probably because it really doesn’t understand it OR how to regulate it. And, the people presenting this bitcoin thing look…………different from the financial folks we are used to, so it must be bad. To quote Bill (Abra’s founder) who recently commented on this topic on CNBC:

“I think the issue with the SEC, quite frankly, is that the people who are doing the applications don’t fit mold of who the SEC is used to approving. I used to work for Goldman Sachs, but if you look at how I’m dressed you probably wouldn’t know it. So I probably, unfortunately, couldn’t go like I am here to a meeting at the SEC to say I’m applying for the ability to issue an ETF.”

This (if you believe that) is why the US is falling farther and farther behind the rest of the world and jurisdictions like Switzerland, Gibraltar, Malta, South Korea, etc. are way in front on crypto and blockchain. Even though Mr. Barhydt believes there will be a bitcoin ETF in 2019, I will take the other side. There will NOT be an ETF here anytime. I got the stodgy SEC on my side of the bet.


Bill Taylor is Managing Partner at Fintek Capital & a frequent contributor to FintekNews