In a statement announcing the move, SEC Chair Gary Gensler said the approval of bitcoin exchange traded product (ETP) shares comes with some stringent requirements. “First, sponsors of bitcoin ETPs will be required to provide full, fair, and truthful disclosure about the products. Investors in any bitcoin ETP that is listed and traded will benefit from the disclosure included in public registration statements and required periodic filings. While these disclosures are required, it is important to note that today’s action does not endorse the disclosed ETP arrangements, such as custody arrangements,” Gensler said.
The financial firms that gained SEC approval to launch Bitcoin ETFs include: Ark Invest, Bitwise, BlackRock, Fidelity, Franklin Templeton, Grayscale, Hashdex, Invesco, WisdomTree, Valkyrie and VanEck. Some of their ETFs are expected to begin trading as soon as today.
Gensler also made it clear in the statement that the agency remains on alert with crypto trading. “While we approved the listing and trading of certain spot bitcoin ETP shares today, we did not approve or endorse bitcoin. Investors should remain cautious about the myriad risks associated with bitcoin and products whose value is tied to crypto,” he wrote.
Mixed Reactions in the Investments World
The announcement was met with enthusiasm from those in the crypto universe. “Today is a monumental day in the history of digital assets,” said Samir Kerbage, chief investment officer at a bitcoin ETF issuer called Hashdex.
Others predicted that the SEC decision will level the playing field in crypto trading. “A spot Bitcoin ETF is a bridge between traditional finance and the burgeoning world of crypto,” Sheila Warren, CEO of the Crypto Council for Innovation told CNN. “Allowing investors to partake in the bitcoin journey without the technical hurdles of direct ownership is a significant step towards inclusivity.”
Not everyone applauded the decision, however. In a statement following the SEC’s announcement, Dennis Kelleher, president and CEO of investor watchdog group Better Markets strongly opposed the SEC’s approval of bitcoin ETFs. “With the flagrantly lawless crypto industry crashing and burning due to a mountain of arrests, criminal convictions, bankruptcies, lawsuits, scandals, massive losses, and millions of investor and customer victims, who would have thought that the SEC would come to its rescue by approving a trusted and familiar investment vehicle that will enable the mass marketing of a known worthless, volatile, and fraud-filled financial product to Main Street Americans,” Kelleher said.
The approval of the ETFs comes after an official SEC social media account on Tuesday falsely said that bitcoin ETFs had been approved. The SEC said the account had been compromised.
The decision also comes after a year that saw major law enforcement action against crypto firms and their leaders, including the conviction of FTX founder Sam Bankman-Fried and multiple actions against Binance and its founder Changpeng Zhao. 
Joseph McCafferty is editor & publisher of Compliance Chief 360°