Bitcoin ETFs may be headed for one epic Gensler ‘rugpull,’ say analysts

There’s a slim accidental the United States Securities and Exchange main Gary Gensler could propulsion the plug connected spot Bitcoin (BTC) exchange-traded funds successful 1 “amazingly sadistic” move, according to Bloomberg ETF analysts. 

In an Oct. 31 tweet directed astatine elder Bloomberg ETF analysts James Seyffart and Eric Balchunas, ETF commentator Dave Nadig posed whether Gensler whitethorn beryllium allowing for spot Bitcoin ETF applications to heap up conscionable to contradict them each astatine erstwhile successful a “semi-comedic rug-pull.”

“I'm definite it volition beryllium overmuch much boring than this -- but sometimes it does consciousness similar this is each a setup for a elephantine Gensler semi-comedic rug-pull,” said Nadig.

I'm definite it volition beryllium overmuch much boring than this -- but sometimes it does consciousness similar this is each a setup for a elephantine Gensler semi-comedic rug-pull.

Responding to the comment, Seyffart admitted that the thought of specified a script has “lingered” successful the backmost of his caput for weeks if not months. “Would beryllium perfectly epic connected his portion though,” added Seyffart.

Balchunas besides piped in, describing a imaginable rug propulsion arsenic “amazingly sadistic” and noted that it would astir apt “trigger [a] question of lawsuits,” successful response.

However, portion some analysts argued the script was unlikely, Balchunas conceded that a last-minute denial wasn’t wholly disconnected the cards, and is wherefore helium and Seyffart won’t rise the likelihood of an support to thing supra 90%.

Related: First Bitcoin ETF trades $1.5B arsenic GBTC ‘discount’ echoes $69K BTC price

Gensler’s ain thoughts connected a spot Bitcoin ETF person precocious made their mode into the spotlight, with a video from 2019 showing Gensler describing the SEC’s presumption connected spot ETF products at the clip arsenic “inconsistent.”

Meanwhile, the SEC has a agelong and storied past of denying spot Bitcoin ETF applications, a inclination which began arsenic acold backmost arsenic 2017.

This bequest has been carried connected by Gensler since helium was appointed caput of the SEC successful 2021. Since past Gensler has delayed and pushed back caller spot Bitcoin ETF applications, citing concerns with capitalist protections. 

In June 2022, the Gensler-led SEC was sued by crypto plus manager Grayscale for rejecting its bid to person its existing Bitcoin spot into a spot ETF, with a court ruling that the SEC the SEC was “arbitrary and capricious” to cull the application. The SEC did not appeal the decision.

To date, the SEC has lone approved ETF applications for Bitcoin and Ether (ETH) futures products, arsenic it claims that spot products bash not person the capable safeguards to support investors from marketplace manipulation.

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