Despite a multi-year market slowdown, there are signs of hope for the Web3 industry. A major political win came in the form of a scathing rebuke from the U.S. District of Columbia Court of Appeals of the U.S. Security and Exchange Commission (SEC) approach to crypto. The court called the SEC’s reasoning arbitrary and capricious when rejecting Grayscale’s proposal to convert a bitcoin trust into an exchange-traded fund (ETF).
David Ackerman, chief compliance officer and data protection officer for Mobilecoin, believes that the strong wording of the decision opens up opportunities for the entire crypto industry. The SEC has already delayed deciding on all open or refiled spot market bitcoin ETF applications until at least October. The SEC has the option to challenge the federal judge’s conclusions in the Grayscale decision, or to deny the application a second time for a different reason.
If the SEC denies the Grayscale application a second time, then another federal judge will review it to determine if the SEC is attacking the industry rather than protecting investors or market integrity. If so, the judge could open the door to future litigation and suggest that individuals may be personally liable.
SEC Chair Gary Gensler and the SEC staff are dedicated public servants who are motivated to ensure U.S. markets are some of the most stable in the world. The United States has a history of balancing innovation with investor protection, and it is time to show that this is possible with Web3.
Ralph Waldo Emerson famously wrote, America is another name for opportunity. Let us remind the world why that is.