- Two U.S. senators asked SEC Chair Gary Gensler not to approve other crypto ETFs.
- Coinbase’s Paul Grewal said that digital assets “demonstrate market quality metrics.”
- Senators said that crypto ETFs would pose “enormous risks” to retail investors.
Coinbase Chief Legal Officer, Paul Grewal, took a shot at two United States senators who sent a letter to Securities and Exchange Commission (SEC) Chair, Gary Gensler, asking the agency not to approve any other crypto exchange-traded funds (ETFs) after spot Bitcoin ETFs.
In the letter, Democrat senators Jack Reed and Laphonza Butler said that crypto ETFs posed “enormous risks” to retail investors. The lawmakers believe that if more crypto ETFs are approved, investors will be exposed to “thinly traded” markets that have succumbed to fraud and manipulation.
Retail investors would face enormous risks from ETPs referencing thinly traded cryptocurrencies or cryptocurrencies whose prices are especially susceptible to pump-and-dump or other fraudulent schemes.
On the other hand, Coinbase’s Grewal took to social media platform X to emphasize that “the evidence points exactly the opposite way.” According to the executive, many digital asset commodities, and not just Bitcoin, “demonstrate market quality metrics that exceed even the largest traded equities.”
Grewal also highlighted that, when compared to Bitcoin, “ETH’s future and spot market demonstrate EXACTLY the same type of high and consistent correlation that would enable market surveillance.”
“However vulnerable Bitcoin may be to fraud and manipulation, markets for other cryptocurrencies are far more exposed to misconduct,” said the letter.
The Coinbase executive responded to the senators’ claim that the market for other cryptocurrencies is not as well-scrutinized as Bitcoin, which already displayed “serious weakness.”
Spot Bitcoin ETFs have been performing extremely well since their approval on January 10. Notably, BlackRock’s iShares Bitcoin Trust (IBIT) has surpassed investors’ expectations, leading the pack of the nine approved ETFs.
Disclaimer: The information presented in this article is for informational and educational purposes only. The article does not constitute financial advice or advice of any kind. Coin Edition is not responsible for any losses incurred as a result of the utilization of content, products, or services mentioned. Readers are advised to exercise caution before taking any action related to the company.
