In a recent interview with CNBC, U.S. Securities and Exchange Commission (SEC) Chair Gary Gensler voiced his ongoing concerns about Bitcoin, labelling it a “highly speculative” and “volatile” asset. This comes despite the SEC’s approval of the first wave of spot Bitcoin exchange traded funds (ETFs).

Gensler underscored that Bitcoin’s purported use cases, such as a store of value and facilitating everyday payments, are overshadowed by its susceptibility to illicit activities. He remarked, “Are we buying cups of coffee with it? Not really.” Gensler further emphasised that investors should remain vigilant as the underlying asset is prone to extreme volatility, citing its association with illicit activities like money laundering, sanctions, and ransomware.

The current price action of Bitcoin sees it trading near the $45,825 level on Thursday, reflecting a 1.1% decline. Notably, since the approval of the first spot Bitcoin ETFs, the cryptocurrency has experienced a 1.9% decrease.

Despite the regulatory green light, Gensler’s reservations about Bitcoin persist. He cautioned that the cryptocurrency’s price fluctuations make it a risky investment, and its association with illegal activities raises concerns about its long-term viability as a legitimate financial instrument.

In a significant move, the SEC has approved several Bitcoin exchange traded funds. The list includes well-known funds like Grayscale Bitcoin Trust (GBTC), iShares Bitcoin Trust (IBIT), Valkyrie Bitcoin Fund (BRRR), Ark 21Shares Bitcoin Trust (ARKB), Invesco Galaxy Bitcoin ETF (BTCO), VanEck Bitcoin Trust (HODL), WisdomTree Bitcoin Trust (BTCW), Fidelity Wise Origin Bitcoin Trust (FBTC), Bitwise Bitcoin ETF (BITB), and Franklin Bitcoin ETF (EZBC).

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Investors are now faced with the dual narrative of regulatory acceptance and cautious skepticism from SEC Chair Gensler, making the Bitcoin market even more complex and challenging to navigate.

This development raises questions about the future trajectory of Bitcoin as an investment class and highlights the SEC’s ongoing efforts to strike a balance between fostering innovation and protecting investors in the dynamic cryptocurrency landscape.