Jeremy Schwartz, Global Chief Investment Officer at WisdomTree, recently underscored the importance of data-sharing agreements for the approval of cryptocurrency spot exchange-traded funds (ETFs) during an interview on June 26. Schwartz’s comments highlighted the pivotal role that these agreements, designed to enhance surveillance across exchanges, could play in addressing the Securities and Exchange Commission’s (SEC) concerns about potential price manipulation in the cryptocurrency market.
WisdomTree recently submitted a new application for a spot Bitcoin ETF on June 20, alongside other firms such as Bitwise, Valkyrie Investments, and Invesco. Schwartz suggested that data-sharing surveillance agreements could potentially sway the SEC’s stance. He further explained that the SEC’s approval of crypto futures ETFs, which started in late 2021, was in part due to the futures market sharing relevant information with the regulatory body.
One of the things that recent [spot Bitcoin ETF] filings have in common … is that they are trying to have data sharing surveillance agreements between exchanges to help make the SEC comfortable with [the question of] price manipulation.
Historically, the SEC has been reluctant to give the nod to spot cryptocurrency ETFs. Schwartz stressed that getting the SEC to feel “comfortable” with the planned price surveillance is crucial to the application being approved.
Addressing broader concerns about fraud and the lack of regulation, Schwartz pointed out that SEC chair Gary Gensler is advocating for “more official regulation.” Further, he made it clear that while the SEC has taken action against cryptocurrencies considered securities, it has treated Bitcoin as a commodity rather than a security, offering a glimpse into the regulatory perspective on Bitcoin and similar cryptocurrencies.
In related news, banking giant HSBC Hong Kong has expanded its support for Bitcoin and Ethereum ETFs. This move signals a growing acceptance and incorporation of cryptocurrency ETFs within the broader financial sector, setting the stage for potential growth and increased adoption in the future.
