Winklevoss Brothers criticize US SEC for rejecting Bitcoin ETFs.

The need for a regulated Bitcoin product, including an Exchange Traded Fund (ETF), is undoubtedly increasing among United States regulators as institutional investors, led by BlackRock Inc (NYSE: BLK) with nearly $10 trillion in Assets Under Management (AUM), seek to enter the crypto industry. With the $1 trillion crypto market estimated to surpass that of precious metals in the coming years, amidst rising global inflation, the demand for well-structured digital assets like Bitcoin and Ethereum cannot be ignored.

As a result, there is a growing political divide between the Democrats and Republicans when it comes to regulating the emerging industry. According to the Biden administration, and perhaps a view shared by most Democrats in Congress, most digital assets are unregulated securities, and investors should prepare for the digital dollar through FedNow in the near future.

On the other hand, some politicians, including presidential aspirant Robert F Kennedy Jr, believe that Bitcoin and other crypto assets are integral parts of financial freedom that need to be protected. Consequently, experts predict a significant rift in next year’s US presidential election regarding matters pertaining to crypto assets.

Winklevoss Brothers Criticize the SEC for Not Approving Safe Bitcoin ETF Products

According to Cameron Winklevoss, one of the co-founders of Gemini exchange, the SEC has pushed American crypto investors towards risky products and firms like FTX by failing to approve safer avenues to access the emerging crypto market. It is worth noting that Gemini filed for a Bitcoin ETF ten years ago, but the SEC rejected the filing.

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:


— Cameron Winklevoss (@cameron) July 2, 2023

According to the SEC, the Bitcoin market is heavily influenced by wash trading, and there are no mechanisms in place to prevent widespread fraud. However, Cameron noted that the SEC needs to stop exceeding its statutory powers in regulating the crypto industry.

“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,” he noted.

It is worth mentioning that some investors have been compelled to enter the digital asset industry through regulated yet risky products like Grayscale Bitcoin Trust (GBTC), which Cameron referred to as toxic. Additionally, Gemini and Digital Currency Group (DCG)-backed Genesis Trading are currently under court supervision due to a failure to reach a reasonable deal on defaulted loans.

Meanwhile, the SEC has dismissed the recent Bitcoin ETF frenzy for lacking clarity and has requested that the respective firms review their filings. The Bitcoin ETF frenzy has significantly contributed to the rebound of BTC price from trading below $25k to as high as $30.8k in the past few weeks.