In situations where there is a pattern of enforcement or regular inquiries, it is a responsibility of the primary regulator to determine if the rule in question is clearly defined. We do not believe the BFMM exception is clearly defined, therefore, we believe the more pressing need is for the SEC to clarify its views on the scope of the BFMM exception. 

More recently, and acutely as it pertains to the Proposal, the Commission has significantly altered its approach on a rulemaking process that has served investors well for close to 90 years. The combination of numerous rule filings, many of which are complex and would lead to major market structure changes; new terminologies and amendments introduced late into the rulemaking process; and short comment periods and lack of clarity of proposed rules, gives us concern that the notice and comment process of rulemaking is being devalued. Our markets, while not perfect, are operating efficiently. We hope that the Commission can return to its historical norm because doing so is in the best interests of the markets and the investors who rely on them for their financial wellbeing. 

We appreciate the Commission’s recent decision to allow the listing and trading of ETFs that hold Bitcoin futures contracts. However, we recognize the need for similar regulatory treatment of Bitcoin futures ETFs registered under the Exchange Act and spot Bitcoin ETFs given they share the same characteristics in relevant respects. In particular, both types of products use similar processes for determining price on the underlying spot cash Bitcoin markets.

The rules crafted and enforced by the Commission are the vital foundation of the Commission’s critical mission objectives. The Associations, however, are concerned that meaningful public input into the rulemaking process, a pivotal element of ensuring that the Commission’s rules are appropriately tailored and that the Commission is meeting its statutory obligations and tripartite mission, is at risk of being lost in the Commission’s current rulemaking agenda.

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October 12-14

JW Marriott Washington DC