The CEO of Grayscale Investments explained the refusal of the American regulator to approve the launch of an ETF for bitcoin by the inability to control the cryptocurrency market.

Michael Sonnenshein, in an interview with CNBC, criticized the arguments of the US Securities and Exchange Commission (SEC), which repeatedly rejected applications from Grayscale, and other companies, to launch Bitcoin-pegged ETFs. The agency fears manipulation in the spot market and claims that there is not enough capacity to detect them. Sonnenshine considers the SEC’s argument unconvincing – the real reason is the apparent inability to regulate the bitcoin market.

Earlier, the regulator approved the launch of an ETF for bitcoin futures, and the spot and futures markets inevitably correlate, the head of Grayscale is convinced.

“The Bitcoin futures market is a derivative of the spot market. They are 99.9% correlated, so the SEC is arbitrary,” Sonnenschein is sure.

Last year, the investment company Grayscale decided to prove its case in court by filing a lawsuit against the SEC for refusing to convert the GBTC fund into an ETF. According to Sonnenschein, things are going well – the Grayscale team sees the persistent desire of investors to get access to bitcoin through ETFs, and the company’s lawyers have weighty arguments. The businessman emphasizes that the Grayscale Bitcoin Trust has been publicly traded since 2015, while reporting to the SEC has been filed only since 2020, so there is no need for additional regulation.

Michael Sonnenshine believes that the SEC is better off focusing on its direct responsibilities, namely investor protection. By adding bitcoin ETFs to the regulatory perimeter, the agency will protect the rights of investors and protect them from uncontrolled products.

Earlier, the head of Grayscale said that by his actions, the SEC violates the Law on Administrative Procedures, and thus only hinders the development of the industry.