Bitcoin ETF Approval More Likely Under New SEC Leadership

Cathie Wood, founder and CEO of Ark Investment Management, said the chances of U.S. regulators approving a bitcoin exchange-traded fund (ETF) have increased under the Biden administration.

In an interview with CNBC’s Bob Pisani today, Wood said there are two signs that the U.S. Securities and Exchange Commission (SEC) may be more willing to give the green light to a Bitcoin ETF. In previous administrations, the SEC did not approve any Bitcoin ETFs, which disappointed the industry.

Specifically, the Ark Investments CEO said she was encouraged by Joe Biden's appointment of Gary Gensler as SEC chairman. Gensler is known as someone who understands the underlying technology of digital assets and Bitcoin itself. In addition, Wood also believes that the head of FinHub Valerie Szczepanik (known as the "crypto czar") reports directly to the next chairman, which is a bullish signal.

“I think the chances of an ETF being approved have increased,” Wood said. “Gensler understands the technology, and I think he understands the currency itself. I think now you have someone involved who really understands this space.”

Wood recognizes the recent surge in institutional interest in the cryptocurrency space, but said she doesn't expect it to be driven by "widespread use of Bitcoin as a replacement for cash on corporate balance sheets." She said such large-scale investment may be slow as the market matures, but she is encouraged by the examples set by Square and Tesla. In October 2020, payment company Square added 4,709 BTC to its balance sheet, while automaker Tesla announced earlier this month that it had purchased $1.5 billion in Bitcoin.

“If all companies in the U.S. put 10% of their cash into Bitcoin, that alone would increase the price of Bitcoin by $200,000,” she said.

Perhaps aware of the potential opportunities in the new regulatory environment, some companies have applied to the SEC for Bitcoin ETFs after Biden took office. Yesterday, New York Digital Investment Group submitted documents for Bitcoin ETF, and on January 22, Valkyrie Digital Assets proposed to list its Bitcoin Trust Fund on the New York Stock Exchange. (Cointelegraph)