Cathie Wood Explains the Political Twist in the Approval of Ethereum ETFs
SEC Surprises with Approval of Ethereum ETFs, Influenced by Political Developments
In a groundbreaking interview with Peter McCormack on the What Bitcoin Did podcast, Cathie Wood, the CEO and CIO of ARK Invest, made headlines by revealing a major development in the world of cryptocurrency. Wood suggests that recent political shifts in the United States may have played a significant role in the surprising approval of several Ethereum exchange-traded funds (ETFs) by the U.S. Securities and Exchange Commission (SEC). This unexpected decision has sparked speculation about the future of crypto.
Wood discussed the SEC’s approval of spot Ethereum ETFs during her appearance at the Consensus 2024 conference on May 29. She identified two key factors that influenced this decision: the passing of the Financial Innovation and Technology for the 21st Century Act (FIT21) in the House and former President Donald Trump’s increasing involvement with cryptocurrencies. Wood believes that cryptocurrency has become a crucial electoral issue, and Trump’s acceptance of Bitcoin and crypto donations during his campaign represents a significant political shift.
According to Wood, this shift in political dynamics caught the attention of the Biden administration, leading to the SEC’s surprising move towards approving ETFs. Prior to this decision, the SEC had shown no indication of progress in the review process for spot ETH ETFs. Typically, the agency would have raised numerous questions during the review, but Wood noted that no such inquiries were made beforehand.
On May 23, the SEC approved rule changes that allow the listing and trading of eight spot ETH ETF funds, including the joint offering by ARK and 21Shares. This sudden change has generated mixed reactions within the financial community.
In subsequent discussions, Wood expressed her preference for Bitcoin over Ethereum. At Consensus 2024, she praised Bitcoin as her top investment choice, emphasizing its unique characteristics as a “global monetary system,” “technology,” and “new asset class.” Wood firmly believes that Bitcoin has more potential than other cryptocurrencies.
Wood envisions Bitcoin capturing up to 20% of the global monetary supply, citing examples like El Salvador, where Bitcoin is legal tender. She sees Bitcoin as a hedge against economic volatility, describing it as an “insurance policy” of sorts.
During her praise of El Salvador’s Bitcoin policies, Wood commended President Nayib Bukele’s approach to Bitcoin, artificial intelligence (AI), and other technologies. She predicts that these policies could significantly boost El Salvador’s GDP in the next five years. Wood considers Bitcoin and AI as two of the most revolutionary economic and technological advancements in history.
With the Salvadoran government holding at least 5,700 BTC, plans are underway to leverage Bitcoin mining for revenue generation, support local businesses, and offer citizenship to Bitcoin investors. Bukele has also introduced ARK Educate’s technology-focused curriculum in schools.
For those interested in learning more about the FIT21 Act and its impact on crypto, there are resources available to delve deeper into this new era of digital asset regulation.
Tags: Bitcoin, Crypto news