The chairman of the US Securities and Exchange Commission (SEC), Gary Gensler, believes that the approval of a spot Bitcoin exchange-traded fund (ETFF) is ironic.
He stated that it was about the traditional means of finance and centralization. He also warned that investors need to remember that Bitcoin is a highly volatile and speculative asset.
He also added that it is used for money laundering, illicit activity, ransomware, sanctions and more of the same.
The irony
The SEC boss appeared on CNBC for an interview on Friday where he discussed the irony of the approval of a spot Bitcoin ETF.
Last week, the securities regulator had given its approval for a total of 11 spot Bitcoin ETFs and the chairman believes it is ironic.
Gensler said that the pseudonymous creator of Bitcoin, Satoshi Nakamoto, had said that it would be a decentralized system.
But, he said that the approval of spot Bitcoin ETFs had resulted in centralization. The SEC chair said that it was ironic that people thought the last week had been historic.
It is because the approval of spot Bitcoin ETFs had led to centralization and had been about the traditional means of finance.
Bitcoin
The chairman asserted that Bitcoin had already been available to investors before the approval, as they were able to purchase it through different brokerages.
Now, he noted that investors could purchase it via an ETF, which was centralized. 11 spot Bitcoin ETFs had been approved in one go by the securities regulator.
While Gensler was the deciding vote on the approval of the ETFs, the chairman clarified that it did not mean that he had endorsed the cryptocurrency.
He clarified that they had not approved or endorsed the crypto token in itself. Instead, he said that they had approved a product known as an exchange-traded product (ETP).
He stated that it was just a way for investors to invest in the underlying asset, which was bitcoin in this case.
Warnings
The SEC chief continued to warn investors about the risk of investing in the underlying asset, something he has done before.
He said that investors should not forget that Bitcoin is a highly volatile and speculative asset and its use cases include money laundering, ransomware, illicit activity, and sanctions.
He continued to add that Bitcoin was nothing more than a speculative store of value. He added that it was not being used as a mode of payment anywhere and people certainly cannot buy coffee with it.
He asserted that the only payment mechanism where Bitcoin was being utilized was for mostly illicit activity.
This is not the first time that the SEC chairman has highlighted the use downsides of Bitcoin and has spoken up against it.
It took the SEC over a decade to finally approve a spot Bitcoin ETF, something it had refused to do due to concerns of market manipulation.