Former SEC Chair Sees Eventual Bitcoin Spot ETF Approval Despite Delays

• Despite recent SEC delays, former chair Jay Clayton argues approval of a spot Bitcoin ETF is inevitable given that major firms now backing crypto funds.
• Clayton believes the dichotomy between approved BTC futures ETFs but rejected spot versions is ultimately unsustainable.
• With both legal and market pressures mounting, Clayton expects progress on spot Bitcoin ETF approval, though SEC delays may persist through 2024.

The SEC’s recent decision to delay rulings on several spot bitcoin ETF applications isn’t deterring former SEC Chair Jay Clayton. He still believes approval is on the horizon despite the ongoing regulatory reluctance.

In a September 1st interview with CNBC, Clayton stated that major financial institutions backing spot bitcoin funds signal a shift in how mainstream investors can access crypto. The SEC designated extended review periods for spot ETF proposals from BlackRock, WisdomTree, VanEck, and others last week.

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However, Clayton expects “progress on this going forward” given the caliber of firms seeking crypto exposure for retail clients. While delays could theoretically continue into 2024, Clayton argues that the dichotomy between approved bitcoin futures ETFs and rejected spot ETFs is ultimately untenable.

Clayton says Bitcoin ETF approval is inevitable

“An approval is inevitable,” he said. “The dichotomy between a futures product and cash product can’t go on forever.”

Clayton’s perspective echoes recent pressure from the courts to approve a spot bitcoin ETF. Judge Neomi Rao ordered the SEC to revisit its rejection of Grayscale’s proposal to convert its Bitcoin Trust into an ETF on the grounds that it was too similar to existing futures offerings.

Despite the ongoing SEC reluctance, Clayton foresees incremental progress as major players demonstrate solid approaches to mitigating risks and meeting regulatory standards. With both legal and market forces stacking up, Clayton and other optimistic observers believe it’s only a matter of time before a spot bitcoin ETF gets the green light.

Yet with the SEC able to delay decisions for months on end, the waiting game for approval continues. The next deadline falls on October 7th for a proposed ETF from Global X. All eyes are on the SEC to see if they finally relent amid the growing pressure.