The SEC under Gensler and his predecessor Jay Clayton has repeatedly balked at green-lighting a crypto ETF, with the agency raising concerns over transparency and potential for manipulation in the Bitcoin cash market.
Most pending ETF applications have been filed under 1930s laws that allow stock exchanges to list products. Gensler is hinting that he’d like to see a filing that seeks approval through a 1940 law that governs mutual funds.
The distinction isn’t just academic. The law for mutual funds has much stronger investor protections and requires funds’ boards to provide close oversight of the investments, lawyers said. The additional demands include a mandate that funds have independent boards and a restriction on affiliated people trading shares in the ETF.
‘Enforcement 40’ for 2020
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