U.S. SEC Chairman Gensler warns of caution in virtual currency investment as expectations rise for approval of BTC spot ETF

Be careful when investing in virtual currency

On the 8th, US Securities and Exchange Commission (SEC) Chairman Gary Gensler issued a warning on X (formerly Twitter) regarding crypto asset (virtual currency) investment.

The content of the post is similar to previous statements, but this warning is attracting a lot of attention as there are many predictions that the SEC will approve a Bitcoin (BTC) spot exchange-traded fund (ETF) for the first time this week.

A thread

Some things to keep in mind if you’re considering investing in crypto assets:

— Gary Gensler (@GaryGensler) January 8, 2024

Gensler first argued that “virtual currency investments and services may not comply with securities laws and other laws.” He also states that he “should understand that investors in virtual currency securities may not be provided with important information or protections.”

He also pointed out that “cryptocurrency investment is extremely risky, and prices often fluctuate significantly.” “There is also a risk that many large platforms and cryptocurrencies have gone bankrupt or become worthless.”

He also claims that “there are still scammers out there who take advantage of the growing popularity of virtual currencies to defraud individual investors.” “Fraud and theft are still prevalent in cryptocurrency investing, and projects sometimes disappear with investors’ money,” he cautioned.

Please note that Mr. Gensler’s post is above and does not mention anything about Bitcoin spot ETFs. Last month, he also posted a video message on X, warning crypto companies of compliance violations.

connection: Cryptocurrency industry rebels against SEC Chairman Gensler’s warning, Ripple CEO also joins in the criticism

Gensler’s true intentions

Until now, the SEC has disapproved all Bitcoin spot ETFs for reasons such as investor protection. On the other hand, current applicant companies have introduced mechanisms to alleviate the SEC’s concerns, and last year a court ruled that the SEC’s approval of only futures ETFs was arbitrary. Expectations are high that it will be approved.

Also, to be fair, the SEC will likely approve multiple ETFs at the same time. Therefore, as Ark’s ETF reaches its final decision deadline on the 10th of this month, it is expected that the spot ETF will be approved soon.

Although some believe that it will be disapproved again based on Gensler’s opinion, Eric Balchunas, senior ETF analyst at Bloomberg, remains bullish. In response to the question from user did.

not that we need any signs at this point but id sayyes

— Eric Balchunas (@EricBalchunas) January 8, 2024

It is also reported that the SEC has broad authority and may try to postpone the decision again.

BTC ETF List Source: Bloomberg

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