Bloomberg analyst calls for FOIA request into SEC’s Ethereum ETF decision Bloomberg analyst calls for FOIA request into SEC’s Ethereum ETF decision
Voting records are unclear and political motives are likely, James Seyffart says.
2 min read
Updated: Jun. 8, 2024 at 12:29 am UTC
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Bloomberg ETF analyst James Seyffart called for freedom of information access (FOIA) requests regarding the SEC’s approval of spot Ethereum ETFs.
In a June 5 KITCO interview, Seyffart said that public requests should search for “emails, calls, [and] anyone that had conversations with [SEC chair] Gary Gensler” to determine what happened during the SEC’s decision-making process.
He said unused denial orders could exist due to the agency’s rapid change in stance.
Voting is unclear
Seyffart said the SEC approved the spot Ethereum ETFs through delegated authority, a common approach but a rare choice for the issue at hand.
Delegated authority also means voting records are unclear.
Seyffart said that the choice points to a politically motivated decision, stating:
“Until I have somebody come out and show me smoking gun evidence … this was political.”
Seyffart said the “leading theory” is that a Biden administration member called SEC chair Gary Gensler and influenced the agency’s decision.
A secondary theory posits that someone swung the vote of a Democratic SEC commissioner who previously voted against spot Bitcoin ETFs. The reversed vote could have led the SEC to vote at least 3-2 in favor of spot Ethereum ETFs even if Gensler voted against the funds.
It is still possible for a commissioner to challenge the decision and force a vote. However, Seyffart said Democratic commissioners are unlikely to gain anything from making the voting record transparent.
He previously said a challenge is unlikely to influence the actual voting results.
SEC should be less political
Seyffart also discussed the broader impact of politics on the SEC. He argued the SEC should not be wholly apolitical but less political than it currently is.
Seyffart believes that, until recently, the SEC has decided to deny spot crypto ETFs and proceeded to find legal justification for its stance after the fact.
Instead, the chair should choose the issues the agency focuses on and seek legal input from individual commissioners, leading to a decision “based on logic and reason,” Seyffart said.
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Author 
Mike Dalton
Before transitioning to crypto writing in 2018, Mike studied library and information sciences. Currently, he resides on Canada's West Coast.
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In this article
Ethereum is a decentralized, open-source blockchain platform that enables the creation of smart contracts and decentralized applications (DApps).
Grayscale Investments
Established in 2013 by Digital Currency Group, Grayscale Investments is a trusted authority on digital currency investing and cryptocurrency asset management.
James Seyffart is a well-regarded analyst at Bloomberg Intelligence, specializing in Exchange-Traded Funds (ETFs) and the broader fund industry.
Gary Gensler is an American government official and former investment banker who President Joseph Biden nominated to chair the U.S.
A businessman, politician, and media personality, Donald John Trump served as the 45th president of the United States from 2017 to 2021.
