BlackRock has questioned the U.S. Securities and Exchange Commission’s (SEC) preference for the 1940 Act in overseeing futures ETFs and argued that it is irrelevant to both crypto-spot and crypto-futures ETFs. The SEC has approved several crypto futures ETFs but has yet to greenlight a single spot-crypto ETF application. The SEC has cited the supposedly superior regulation and consumer protections under the 1940 Act as the reason for this distinction. However, BlackRock argues that this preference lacks relevance as it does not address the underlying assets or the markets from which their pricing is derived. BlackRock believes that the SEC’s approval of crypto futures ETFs via the Chicago Mercantile Exchange (CME) indicates that CME surveillance can detect spot-market fraud, leaving no justifiable reason to reject spot-crypto ETF applications. Analysts predict that the first SEC approval of a spot crypto ETF, possibly a Bitcoin-related one, is imminent.
