In an interview with Bloomberg, Mike Belshe, CEO of BitGo, gave an unexpected opinion on the outcome of the ongoing Bitcoin Spot ETF applications. According to the head of the cryptocurrency custody company, there is a good chance that the SEC will reject these requests. He explains why.
SEC will most likely reject pending ETF applications
So far, the crypto sphere has remained very optimistic about the outcome of Bitcoin ETF applications filed by BlackRock, Franklin Templeton, etc. Moreover, several analysts specializing in ETFs have estimated the chances of approval of these requests at 90%. Since then, the price of bitcoin has appreciated, exceeding the $36,000 mark.
It took Mike Belshe, CEO of BitGo, gives an interview to Bloomberg to destroy this optimist and question certainties. Belshe believes it is “very likely” that Bitcoin ETF applications will be rejected, as the institution led by the indefatigable Gary Gensler has a track record of rejecting applications.
The SEC’s arguments have often been based on possible risks of market manipulation and insufficient protections offered to customers. Belshe thinks that the American financial markets regulator could play this famous card again.
Coinbase could be the cause of Bitcoin Spot ETF applications being rejected
The CEO of BitGo, a US-based cryptocurrency custodian, believes there is a big flaw in the various Bitcoin ETF applications filed. This flaw, he reveals, is the Coinbase exchange. Mike Belshe notes that most companies that have submitted a request for approval for a Bitcoin Spot ETF have chosen Coinbase as their ETF custody partner.
Belshe recalled the FTX episode and the huge losses of funds suffered by the Americans. He also reminded that Coinbase is an exchange like FTX and should therefore not provide ETF custody services.
He believes that the SEC could consider the choice of an exchange for the custody of Bitcoin Spot ETFs as a “significant risk factor”. He predicts that the SEC could require ETF applicants to choose a custodian that does not also operate as an exchange. If its reasoning seems to hold water, the SEC has still not given its opinion on Bitcoin ETFs. The suspense therefore remains.
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