James Angel sympathizes with the Securities and Exchange Commission, he said in an August comment letter to the regulator regarding spot bitcoin ETFs.
Angel, an associate professor of finance at Georgetown University's McDonough School of Business, said in a subsequent interview he suspects the SEC fears that if it greenlights a spot bitcoin ETF, that will be seen as government approval of bitcoin. The regulator, aware of Wall Street's marketing muscle, doesn't want to "unleash a bitcoin bull" into the retail investor china shop, he said.
But despite his sympathy, Angel's letter had a message for the SEC, delivered in bold type and all caps:
"IT'S TOO LATE! THE COW HAS LEFT THE BARN!"
Foregoing the bold type but continuing to display some upper-case emphasis, Angel in his letter noted that not only had the SEC already approved a futures-based bitcoin ETF, but also "a LEVERAGED futures-based ETF!" If the SEC believes that bitcoin is so bad, "it should never have approved any of those," the letter said.
"The SEC has continually rejected spot-based ETFs while allowing futures-based ones to trade. This makes no sense," Angel said in the letter. "The spot and futures markets are closely locked together through arbitrage, and the difference in market prices between the spot bitcoin price and the futures price is negligible."
The SEC lacks the budget it needs to police our financial markets effectively, the letter said. However, it's tough for Congress to justify an appropriate budget for the agency when the SEC squanders its limited resources on "endless regulatory proceedings and fruitless litigation," the letter said.
The letter, which referenced seven spot bitcoin exchange-traded product applications including one pertaining to BlackRock's iShares Bitcoin Trust, urged the SEC to approve the proposals, and in underlined and bolded type spelled out what Angel believes it would behoove the regulator to do:
"The SEC should stop wasting resources fighting bitcoin ETFs!"