“It creates a bridge to the traditional financial market,” said James Seyffart, a Bloomberg Intelligence analyst who tracks E.T.F.s. “Long term, I think money’s going to come in.”
Crypto proponents had pushed for the introduction of a Bitcoin E.T.F. for years, hoping it would accelerate adoption of cryptocurrencies more broadly. In 2021, the S.E.C. approved funds that track the fluctuations of Bitcoin without holding the currency itself. But the agency argued that a fund that contained Bitcoin would pose big risks to consumers, citing illegal manipulation of crypto prices, among other issues.
Those arguments failed in court. In August, the S.E.C. lost a legal battle with the crypto asset manager Grayscale Investments, one of the firms that applied to offer the product, clearing the path to a Bitcoin E.T.F.
Bitcoin’s price soon skyrocketed and this month reached nearly $47,000, its highest value since a series of bankruptcies sent the industry into a meltdown in 2022.
On social media, speculation raged about the timing of an approval by the S.E.C. The fake announcement on Tuesday prompted 15 minutes of celebration before Mr. Gensler intervened on X. An official X account for the platform’s safety resources said the agency had not enabled two-factor authentication, a common digital security tool, to protect its account.
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