According to the CEO of Grayscale Investments, Michael Sonnenshein, the United States Securities and Exchange Commission’s (SEC) approach to crypto regulatory compliance has prevented the growth of Bitcoin in the nation.
According to Sonnenshein, the regulator’s inactivity “prevented Bitcoin’s advancement into the U.S. regulatory perimeter,” and also delayed the adoption of crypto businesses.
In a letter that was published in The Wall Street Journal on January 23, the head of the digital asset management company asserts that the SEC was “late to the game” when it came to regulating cryptocurrencies and averting FTX’s bankruptcy.
Sonnenshein continued:
“Late doesn’t capture what transpired here. The problem is the Securities and Exchange Commission’s one-dimensional approach of regulation by enforcement.”
Furthermore, he said that while the SEC “should try to eliminate bad actors,” it shouldn’t obstruct “efforts to develop appropriate regulation.”
American investors have been compelled to use overseas cryptocurrency enterprises” with less protection and oversight” as a result, he claimed.
He added:
“We are seeing the consequences of the SEC’s priorities play out in real-time — at the expense of U.S. investors.”
Grayscale’s Pursuit of Bitcoin ETF
Notably, the Securities and Exchange Commission rejected Grayscale Investments’ request to convert the Grayscale Bitcoin Trust (GBTC) into a full-fledged exchange-traded fund (ETF) product, and Grayscale Investments filed an appeal with the United States Court of Appeals for the District of Columbia Circuit in June last year.
Numerous letters were sent to the SEC since the filing in support of Digital Currency Group (DCG)-owned cryptocurrency giant’s plans to convert the Grayscale Bitcoin Trust into a spot Bitcoin ETF. Several well-known companies in the bitcoin industry, including Coinbase, backed the asset management.
In November, Grayscale Investment declared that it will not be revealing any information about its proof-of-reserve procedures, citing security concerns. In addition, Grayscale had guaranteed its investors that their assets were safe and secure while under Coinbase Custody Trust Company, LLC’s care.
