Gensler says SEC's 'new look' at spot bitcoin ETF applications has involved recent court rulings

Securities and Exchange Commission Chair Gary Gensler said Thursday that the agency's "new look" at applications for a spot bitcoin ETF had been taking recent court rulings into consideration. 

While the SEC has for years denied previous applications for a spot bitcoin fund, a panel of judges who ordered the regulator to reconsider a failed bid from Grayscale Investments may be starting to tip the balance. The agency is considering more than a dozen applications now from major asset managers including BlackRock and Fidelity. 

"We had in the past denied a number of these applications, but the courts here in the District of Columbia weighed in on that," Gensler said on Thursday in an interview with CNBC.  "So we're taking a new look at this based upon those court rulings."

Three judges in the U.S. Court of Appeals for the D.C. Circuit ruled in August that the SEC has to re-review Grayscale's bid for a spot bitcoin ETF after the asset management firm sued the agency last year following the rejection of its plan for the conversion of its flagship GBTC fund. The court specifically addressed the SEC's differential treatment of spot bitcoin ETFs and similar funds based on futures contracts, which the regulator has approved. 

In September, Gensler told lawmakers he was reviewing that court's decision as well as "multiple filings around bitcoin exchange-traded products."

Crypto is still rife with fraud, Gensler says

Gensler reiterated his view that the crypto industry has a lot of noncompliance with existing securities laws. 

"There's been far too much fraud and bad actors in the crypto field," Gensler told CNBC. "There's a lot of noncompliance, not only with the securities laws, but other laws around anti-money laundering and protecting the public against bad actors there." 

AML has come into focus for the industry following calls in Congress and from the Treasury Department. Last month, Treasury sent recommendations to lawmakers asking them to give it more authority and sanctions tools to go after illicit actors in the crypto industry.