SEC Faces Pressure from Senators: No More Crypto ETFs, Coinbase Responds

• U.S. Senators express concerns to the SEC about the risks of approving more crypto ETFs, emphasizing the potential harm to retail investors.
• Coinbase advocates for the approval of Ether ETFs, presenting data to counteract senators’ concerns and indicating a strong market foundation for digital assets.

In the wake of CNF’s recent update on analysts express concern over short-term correction, a new development unfolds as two U.S. senators urge SEC Chairman Gary Gensler to suspend the approval of additional cryptocurrency exchange-traded funds (ETFs), pointing to “enormous risks” for retail investors.

Contrary to the senators’ caution, Coinbase’s Chief Legal Officer, Paul Grewal, presents a compelling argument for the correlation between Ether’s futures and spot markets, as strong as Bitcoin’s, suggesting the senators’ letter may not fully grasp the market’s dynamics. Grewal made his case through a notable tweet, stating,

Respectfully Senators, the evidence points exactly the opposite way. We have discussed our analysis with SEC staff and would be happy to do the same for you and any other policy makers who have questions. 1/7 https://t.co/juFj4QyDnj

— paulgrewal.eth (@iampaulgrewal) March 15, 2024

Amidst this, the senators’ letter to Chairman Gensler highlights a cautious stance towards crypto ETFs, emphasizing the potential for fraud and manipulation within the markets. They notably stated,

However vulnerable Bitcoin may be to fraud and manipulation, markets for other cryptocurrencies are far more exposed to misconduct.

This sentiment reflects a broader skepticism towards rapidly evolving digital asset markets.

Further engagement on the topic came from Nate Geraci, President of the ETF Store, who observed Coinbase’s staunch support for spot Ether ETFs, implying a brewing conflict between the crypto exchange and regulatory bodies. Geraci’s tweet: Tweet by Nate Geraci underscores the anticipation of Coinbase’s next moves as the deadline for an ETH ETF decision approaches.

None of this is about “protecting investors”…

It’s all about politics.

Sad.

It’s all sour grapes b/c investors want exposure to spot btc ETFs.

Instead of drafting letters, how about politicians put some real effort into actual crypto regulation.

It’s all so tiresome.

— Nate Geraci (@NateGeraci) March 15, 2024

Adding to the discourse, another tweet by Alexander Grieve pointed out the senators’ push against setting a precedent with the recent approval of spot Bitcoin ETFs for further cryptocurrencies, highlighting the vulnerability of these markets to malpractices. As this conversation about cryptocurrency ETFs continues, with Coinbase at the forefront of advocating for regulatory clarity and inclusivity, the crypto market remains under keen observation. Bitcoin’s recent price movements and Ethereum’s resistance levels serve as a backdrop to the ongoing debate between innovation and regulation in the financial system.

Over the past week, Bitcoin experienced a surge of 1.30%, but witnessed a decline of 7.14% in the last 24 hours, bringing its price to $68,317, as illustrated in the chart below. This ongoing debate and market activity underscore the complex interplay between innovation, regulation, and investor protection in the evolving landscape of digital finance.