Crypto Becomes U.S. Election Issue: Cathie Wood Explains Sudden SEC Approval of Ethereum ETFs

In a revealing interview with Peter McCormack, host of the What Bitcoin Did podcast, ARK Invest CEO and CIO Cathie Wood made headlines by declaring that cryptocurrency has become a pivotal issue in U.S. politics. Wood suggested that this political shift was a key factor in the U.S. Securities and Exchange Commission’s (SEC) unexpected approval of several ether exchange-traded funds (ETFs).

Crypto and Politics: A New Nexus

On May 29, during the Consensus 2024 conference, Wood discussed the SEC’s unexpected approval of spot Ethereum ETFs. According to Wood, this decision was influenced by two main factors: the House’s recent passage of FIT21 and former President Donald Trump’s growing involvement with the crypto community.

Wood highlighted the importance of the Financial Innovation and Technology for the 21st Century Act (FIT21), which makes cryptocurrency a significant electoral issue. This, along with Trump’s acceptance of Bitcoin and other cryptocurrencies—shown by his campaign’s acceptance of crypto donations, marked a major political shift. 

Wood believes this got the Biden administration’s attention, leading to the SEC’s sudden approval of the ETFs.

SEC’s Unexpected Approval

Before this sudden approval, the SEC had shown no indication of moving forward with the pending spot ETH ETFs. Typically, the agency would have posed numerous questions to the issuers during the review process. 

However, Cathie Wood pointed out that “no one was getting questions from the SEC beforehand.”

Later on May 23, the SEC approved rule changes that now allow the listing and trading eight spot ETH ETF funds, including the joint offering by ARK and 21Shares. This abrupt shift has sparked mixed reactions within the financial community.

Bitcoin over Ethereum, ‘Any Day’

In further interviews, Cathie Wood highlights her preference for Bitcoin over Ethereum. At Consensus 2024, she described Bitcoin as her top investment choice, highlighting its unique qualities as a “global monetary system,” “technology,” and “new asset class.” Wood believes Bitcoin’s potential far surpasses other cryptocurrencies.

Wood envisions Bitcoin capturing up to 20% of the global monetary supply, following examples like El Salvador, where Bitcoin is legal tender. She sees Bitcoin as an “insurance policy” against economic instability.

Praise for El Salvador’s Crypto Policies

Cathie Wood praised El Salvador’s Bitcoin policies after meeting with President Nayib Bukele. She admired Bukele’s approach to Bitcoin, AI, and other technologies, predicting these policies could boost El Salvador’s GDP in five years. Wood called Bitcoin and AI “two of the biggest economic and technology revolutions in history.

El Salvador’s government, holding at least 5,700 BTC, plans to generate income from Bitcoin mining, support local businesses, and offer citizenship to Bitcoin investors. Bukele also introduced ARK Educate’s tech-focused curriculum in schools.


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