The co-founder of Gemini, Cameron Winklevoss, has alleged that the SEC has been responsible for forcing investors into toxic crypto products. Winklevoss targeted the regulator on July 2 as a result of its continuous dismissal and refusal of spot Bitcoin (BTC) exchange-traded funds. He also highlighted how it has been more than a decade since Gemini filed for the approval of its Bitcoin ETF by the SEC.
Today marks 10 years since @tyler and I filed for the first spot Bitcoin ETF. The @SECGov's refusal to approve these products for a decade has been a complete and utter disaster for US investors and demonstrates how the SEC is a failed regulator. Here's why:
-"protected"… pic.twitter.com/xmK1xo1iX8
— Cameron Winklevoss (@cameron) July 2, 2023
At the same time, he did not hold back to mention how the refusal of the SEC to approve such products for over ten years has been a nightmare for US-based investors, and the shortcoming clearly demonstrated how the SEC is a failed regulator. Without the approval of the Bitcoin ETF, investors in the US have been pushed into a series of toxic products like the Grayscale Bitcoin Trust, which trades at a great discount to the price of Bitcoin, but charges increasingly higher fees.
Based on the study conducted by MorningStar, a financial services firm, the GBTC’s NAV discount currently stands at the 30% mark in comparison to the price of Bitcoin. Similarly, the annual fee of GBTC is currently 2%, which is way higher than an average fee of 0.40%. Furthermore, Winklevoss believes that the incompetence of the SEC has set the stage for investors to move to unlicensed and unregulated offshore platforms, including FTX, which he has described as being one of the biggest financial frauds in the modern world.
The SEC Continues TO Maintain a Negative Stance
As per the current situation, a number of analysts believe that the SEC might eventually reflect upon its actions instead of acting like a gatekeeper of economic life.
Winklevoss added,
“Maybe the SEC will reflect on its dismal record and instead of overstepping its statutory power and trying to act like the gatekeeper of economic life, it will focus on fulfilling its mandate of investor protection.”
It is necessary to keep in mind that these comments by Winklevoss against the SEC have been made during a time when a number of firms, including Fidelity Investments have refiled for Bitcoin ETF. These firms previously filed for Bitcoin ETF approvals but did not receive a reply at all.
However, the SEC claims that some of the filings made for the ETF are either not sufficient or have inadequate information. Keeping the clarity of these filings in mind, the regulator has asked firms to resubmit them after proper clarification.
