SEC Chair Clayton on Bitcoin ETFs: Market Manipulation and Custody Still a Concern

The US Securities and Exchange Commission (SEC) Chair Jay Clayton has told a reporter at CNBC that manipulation in crypto markets remains a concern and that there is “still work to be done” before the Commission can approve Bitcoin exchange-traded fund (ETFs).

Clayton told Bob Pisani that exchanges have come closer to satisfying the SEC on the matter of market manipulation and safe custody of “crypto assets,” but said that remaining questions are “not trivial”:

“Given that they trade on largely unregulated exchanges […] how can we be sure that those prices aren’t subject to significant manipulation? Now progress is being made, but people needed to answer those hard questions for us to be comfortable that this was the appropriate type of product.”

In a previous interview with CNBC, Clayton told the outlet that the SEC is eager to ensure that companies selling tokenized securities and/or crypto derivatives securely possess the assets they intend to issue shares for.

Dozens of cryptocurrency exchanges across the globe have been hacked for billions of dollars in crypto tokens since the Bitcoin network was launched in 2009.

“We’re engaging on (the matter of Bitcoin ETFs,” said Clayton, “but there are a couple of things about it that we need to feel comfortable with. The first is custody: custody is a long-standing requirement in our markets, and if you say you have something you really have it.”

A number of Bitcoin ETF proposals are now before the commission.

Decisions on those proposals may arrive in late September and early October.

VanEck has been working for more than a year to bring a Bitcoin ETF to market. The company recently announced it will selling shares in a Bitcoin Trust to qualified institutional buyers located outside the US.


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