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SEC commissioner Hester Peirce says the agency created an 'investor protection problem' by not approving a Bitcoin ETF — a day after chairman Gary Gensler dashed hopes of that happening this year

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US Securities and Exchange Commission (SEC) commissioner Hester Peirce, known as "crypto mom" for her support of digital assets, said at a virtual event on Wednesday that the SEC's refusal to approve a Bitcoin exchange-traded fund thus far has created an "investor protection problem."

The comments come after SEC chairman Gary Gensler dashed hopes for a speedy approval this week in a statement from the SEC's Division of Investment Management on Tuesday. The statement called Bitcoin "highly speculative" and warned of the risks of trading bitcoin futures, a strategy on which a Bitcoin ETF would likely be dependent. 

Peirce, who in 2018 was the only commissioner to vote in favor of approving a Bitcoin ETF, said that while other countries, like Brazil and Canada, are giving people access to crypto assets, that the SEC has been putting up barriers to access in the US. She pointed to Ethereum ETFs in Canada as examples of a product that would work in the US as well.

Speaking at the Wall Street Journal's The Future of Everything event, Peirce said that investors who might have otherwise accessed Bitcoin through "regulated markets" overseen by the SEC are now going through "less direct routes to get the same result," which has not been beneficial for them.

While Peirce said she hopes recently sworn-in Gensler will take a more "progressive view" towards crypto, her concerns do not seem to have affected the approval process for the nine new crypto ETF filings currently under SEC review.

In addition to the statement on Tuesday, Gensler also told Congress on Monday that the crypto market could benefit from greater oversight and asked lawmakers to grant the agency regulatory authority over trading venues. Some analysts view Gensler's comments as a signal that a Bitcoin ETF will not likely be approved this year and is not a priority for the agency, according to a report in Bloomberg.

Digital asset supporters were hopeful that Gensler's nomination to the SEC would be a positive indicator for the decades-long effort to get a Bitcoin ETF approved in the US. Gensler, who taught the course "Blockchain and Money" at MIT, has previously called blockchain technology a "catalyst for change," Insider reported

Referring to the SEC Division of Investment Management's Tuesday staff statement, Peirce said she "didn't love the tone."

"I think, you know, we want people to be cautious no matter what product they buy. But I think we need to have a more welcoming tone," Peirce said.

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