CFTC Official Argues Against SEC's Grounds for Disapproving Bitcoin ETFs

Brian Quintenz, a Commissioner at the United States Commodity Futures Trading Commission, has argued against the Securities and Exchange Commission's grounds for not approving a Bitcoin exchange traded fund.

Quintenz made his remarks during a panel at the BiPartisan Policy Center in Washington D.C. on Feb. 12.

Quintenz specifically argued that potential price manipulation should not be a barrier to the SEC approving a Bitcoin ETF. The CFTC Commissioner participated in the panel alongside SEC Commissioner Heister Peirce.

Peirce has notably earned the moniker of "Crypto mom" due to her vocal dissent against the SEC's move to twice reject a BTC ETF proposal from the Winklevoss twins.

As reported, the SEC has reiterated its qualms over inadequate "Resistance to price manipulation" multiple times in its rulings or reviews of BTC-based ETFs.

Quintenz drew a parallel between the SEC's stance and that of his own agency, noting that the CFTC's "Jurisdiction over contracts requires that they not be readily susceptible to manipulation."

"There are mathematical ways through a settlement index to design a contract where even if there isn't a lot of liquidity on one exchange referenced, the index itself is not readily susceptible to manipulation."

" they would have to have the majority of volume on multiple exchanges in multiple five minute periods.

"At the SEC we have been unwilling to sign off on a Bitcoin ETF thus far. My concern is that it looks a bit like a merit based approach, judging the underlying Bitcoin market and saying we don't think these are regulated enough. You know, there's lots of markets that aren't regulated, but we nevertheless build products on top of them."

As previously reported, Peirce's dissent from the SEC's negative ruling on the Winklevoss BTC ETF application derived from her view that the agency had overstepped "Its limited role." According to the Commissioner, the SEC was focusing upon the characteristics of the underlying Bitcoin spot market, rather than the derivative the applicants had sought to list, in making its decision.