Former SEC Chairman: Approval of spot Bitcoin ETF is inevitable

“The SEC has been pushed into a corner and has no more reasons to reject spot BTC ETFs.”

Source: Bitcoinist

Compiled by: Blockchain Knight

With less than a day left until the SEC (U.S. Securities and Exchange Commission) deadline to approve or reject the first spot BTC ETF, various experts have come forward to share their views on possible actions by the regulator.

Former SEC Chairman Jay Clayton also expressed his views.

The former SEC chairman participated in CNBC’s famous “Squawk Box” show, where he shared his expectations for the 13 pending spot BTC ETF applications. Unlike some who take a conservative stance, Clayton chose the line of absolute certainty.

Clayton said: Regulators have nothing to consider in terms of processing these spot ETF applications. Therefore, he is certain that the SEC will approve the ETF application rather than reject it.

Clayton has been working in the crypto asset industry for at least two years since leaving the regulator. He explained that a lot has changed compared to five years ago when regulators rejected applications for spot ETFs.

At the same time, he hinted: “The reason why spot ETFs were rejected five years ago was because of illegal situations such as ladder trading, as well as various things that we did not want the public to have access to.”

However, since the new applicant is a major player in the overall financial industry and due diligence is ongoing, Clayton believes there is no reason for regulators to reject spot ETFs.

“I think approval is inevitable and there’s nothing that requires another decision,” Clayton said.

One unique thing about this batch of spot BTC ETF applicants is how they followed up on the SEC’s recommendations on their application documents.

Applicants have modified their application documents multiple times over the past few months, most recently with all applicants except Hashdex updating their S-1 documents.

This demonstrates the applicant’s commitment to actually complying with the rules and ensuring that spot ETFs are carefully designed for investors.

Interestingly, Clayton is not the only one who believes that the SEC will have no choice but to approve a spot BTC ETF. Bloomberg analyst James Seyffart also holds the same view. He believes that regulators will not be able to make applicants withdraw their applications.

Seyffart added: “The SEC has been backed into a corner and there is no more reason to reject a spot BTC ETF.”

Previously, the court ruled that the SEC had no sufficient reason to reject Grayscale’s request to convert its BTC trust into a spot ETF.

Legal expert James Murphy once said that if the SEC really rejects the application for spot ETFs, then he expects all applicants to sue the regulatory agency.

If that happens, the SEC will lose again because the court will find the SEC’s ruling to be “arbitrary and capricious.”