The Securities and Exchange Commission (SEC) is under pressure from Congress to stop approving new cryptocurrency exchange-traded products (ETPs) due to concerns about the risks they pose to retail investors.
According to a letter to regulators dated March 11, Senators Jack Reed and Lafonza Butler emphasized the dangers posed by insufficient disclosures by brokers and insufficient liquidity in major cryptocurrencies.
The senators noted: “We are writing to urge the Securities and Exchange Commission (SEC) to take steps to protect investors following its recent approval of the listing and trading of certain spot bitcoin exchange-traded products (ETPs).”
“SEC approvals provide Wall Street with the green light to sell volatile cryptocurrency investments to ordinary Americans through their brokerages and retirement accounts.”
The success of BTC spot products has clearly ruffled some feathers on the hill. @SenatorJackReed And @Senlaphonza write to @SECGov to urge:
-No more ETPs for other tokens
-Make life difficult for brokers and advisors recommending BTC ETPs (ie examination/review). pic.twitter.com/enxdumC02N— Alexander Grieve (@AlexanderGrieve) 14 March 2024
Senators Reed and Butler highlighted findings from a survey conducted by FINRA that 70% of brokers’ communications with retail investors violate fair disclosure rules.
In particular, legislators questioned brokers who misrepresented cryptocurrencies to cash and gave misleading explanations of the risks of cryptocurrencies. Such deficiencies highlight relevant incomplete and fraudulent information Bitcoin
Bitcoin
Some may still be wondering what Bitcoin is, who created Bitcoin, or how Bitcoin works, but one thing is certain: Bitcoin has changed the world. No one can remain indifferent to this revolutionary, decentralized, digital asset or its blockchain technology. In fact, we’ve come a long way since Laszlo Haniecz, a Florida resident, traded 10,000 bitcoins for 2 pizzas at his local Papa John’s to make the first official commercial transaction of BTC with a real company. Now one can argue that
Some may still be wondering what Bitcoin is, who created Bitcoin, or how Bitcoin works, but one thing is certain: Bitcoin has changed the world. No one can remain indifferent to this revolutionary, decentralized, digital asset or its blockchain technology. In fact, we’ve come a long way since Laszlo Haniecz, a Florida resident, traded 10,000 bitcoins for 2 pizzas at his local Papa John’s to make the first official commercial transaction of BTC with a real company. Now one can argue that
Read this term ETP
risk factors
Proponents argue that such labeling of spot bitcoin ETFs obscures important features, potentially misleading retail investors. He expressed the need for investors to understand the difference between ETPs and traditional funds.
In addition, doubts were expressed about the integrity of Reed and Butler Cryptocurrency
Cryptocurrency
Virtual currencies, also known as cryptocurrencies, are nearly counterfeit-proof digital currencies built on blockchain technology, using cryptography. Consisting of decentralized networks, blockchain technology is not overseen by a central authority. Therefore, cryptocurrencies operate in a decentralized manner that theoretically protects them from government interference. The term cryptocurrency comes from the origin of encryption techniques used to secure networks.
Virtual currencies, also known as cryptocurrencies, are nearly counterfeit-proof digital currencies built on blockchain technology, using cryptography. Consisting of decentralized networks, blockchain technology is not overseen by a central authority. Therefore, cryptocurrencies operate in a decentralized manner that theoretically protects them from government interference. The term cryptocurrency comes from the origin of encryption techniques used to secure networks.
Read this term, specifically highlighting the vulnerability of Bitcoin and its susceptibility to fraudulent schemes. He warned that retail investors may face risks from ETPs linked to cryptocurrencies, especially those that are prone to price manipulation.
In January, the SEC approved 11 spot bitcoin ETFs. The approval comes after years of anticipation and denial, marking a significant shift in how investors can access and participate in cryptocurrencies on traditional financial platforms.
The approval of the Spot Bitcoin ETF eased retail investors’ access to cryptocurrency, allowing them to trade crypto through their brokerage accounts. This eliminates the need for a separate crypto exchange and reduces the risks associated with direct holdings, such as security breaches and fraud.
The Securities and Exchange Commission (SEC) is under pressure from Congress to stop approving new cryptocurrency exchange-traded products (ETPs) due to concerns about the risks they pose to retail investors.
According to a letter to regulators dated March 11, Senators Jack Reed and Lafonza Butler emphasized the dangers posed by insufficient disclosures by brokers and insufficient liquidity in major cryptocurrencies.
The senators noted: “We are writing to urge the Securities and Exchange Commission (SEC) to take steps to protect investors following its recent approval of the listing and trading of certain spot bitcoin exchange-traded products (ETPs).”
“SEC approvals provide Wall Street with the green light to sell volatile cryptocurrency investments to ordinary Americans through their brokerages and retirement accounts.”
The success of BTC spot products has clearly ruffled some feathers on the hill. @SenatorJackReed And @Senlaphonza write to @SECGov to urge:
-No more ETPs for other tokens
-Make life difficult for brokers and advisors recommending BTC ETPs (ie examination/review). pic.twitter.com/enxdumC02N— Alexander Grieve (@AlexanderGrieve) 14 March 2024
Senators Reed and Butler highlighted findings from a survey conducted by FINRA that 70% of brokers’ communications with retail investors violate fair disclosure rules.
In particular, legislators questioned brokers who misrepresented cryptocurrencies to cash and gave misleading explanations of the risks of cryptocurrencies. Such deficiencies highlight relevant incomplete and fraudulent information Bitcoin
Bitcoin
Some may still be wondering what Bitcoin is, who created Bitcoin, or how Bitcoin works, but one thing is certain: Bitcoin has changed the world. No one can remain indifferent to this revolutionary, decentralized, digital asset or its blockchain technology. In fact, we’ve come a long way since Laszlo Haniecz, a Florida resident, traded 10,000 bitcoins for 2 pizzas at his local Papa John’s to make the first official commercial transaction of BTC with a real company. Now one can argue that
Some may still be wondering what Bitcoin is, who created Bitcoin, or how Bitcoin works, but one thing is certain: Bitcoin has changed the world. No one can remain indifferent to this revolutionary, decentralized, digital asset or its blockchain technology. In fact, we’ve come a long way since Laszlo Haniecz, a Florida resident, traded 10,000 bitcoins for 2 pizzas at his local Papa John’s to make the first official commercial transaction of BTC with a real company. Now one can argue that
Read this term ETP
risk factors
Proponents argue that such labeling of spot bitcoin ETFs obscures important features, potentially misleading retail investors. He expressed the need for investors to understand the difference between ETPs and traditional funds.
In addition, doubts were expressed about the integrity of Reed and Butler Cryptocurrency
Cryptocurrency
Virtual currencies, also known as cryptocurrencies, are nearly counterfeit-proof digital currencies built on blockchain technology, using cryptography. Consisting of decentralized networks, blockchain technology is not overseen by a central authority. Therefore, cryptocurrencies operate in a decentralized manner that theoretically protects them from government interference. The term cryptocurrency comes from the origin of encryption techniques used to secure networks.
Virtual currencies, also known as cryptocurrencies, are nearly counterfeit-proof digital currencies built on blockchain technology, using cryptography. Consisting of a decentralized network, blockchain technology is not overseen by a central authority. Therefore, cryptocurrencies operate in a decentralized manner that theoretically protects them from government interference. The term cryptocurrency comes from the origin of encryption techniques used to secure networks.
Read this term, particularly highlighting Bitcoin’s vulnerability and susceptibility to fraudulent schemes. He warned that retail investors may face risks from ETPs linked to cryptocurrencies, especially those that are prone to price manipulation.
In January, the SEC approved 11 spot bitcoin ETFs. The approval comes after years of anticipation and denial, marking a significant shift in how investors can access and participate in cryptocurrencies on traditional financial platforms.
The approval of the Spot Bitcoin ETF eased retail investors’ access to cryptocurrency, allowing them to trade crypto through their brokerage accounts. This eliminates the need for a separate crypto exchange and reduces the risks associated with direct holdings, such as security breaches and fraud.