There’s a slim chance United States Securities and Exchange Commission Chair Gary Gensler could pull the plug on spot Bitcoin (BTC) exchange-traded funds (ETF) in one “amazingly sadistic” move, according to Bloomberg ETF analysts.

In an Oct. 31 tweet directed at senior Bloomberg ETF analysts James Seyffart and Eric Balchunas, ETF commentator Dave Nadig posed whether Gensler may be allowing for spot Bitcoin ETF applications to pile up just to deny them all at once in a “semi-comedic rug-pull.”

“I’m sure it will be much more boring than this — but sometimes it does feel like this is all a setup for a giant Gensler semi-comedic rug-pull,” said Nadig.

I’m sure it will be much more boring than this — but sometimes it does feel like this is all a setup for a giant Gensler semi-comedic rug-pull.

— Dave Nadig (@DaveNadig) October 30, 2023

Responding to the comment, Seyffart admitted that the thought of such a scenario has “lingered” in the back of his mind for weeks, if not months. “Would be absolutely epic on his part though,” he added.

Balchunas also piped in, describing a potential rug pull as “amazingly sadistic” and noting that it would probably “trigger [a] wave of lawsuits” in response.

However, while both analysts saw the scenario as quite unlikely, Balchunas conceded that a last-minute denial wasn’t entirely off the cards — part of the reason why he and Seyffart were hesitant to raise the odds of an approval to anything above 90%.

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Gensler’s own thoughts on a spot Bitcoin ETF have recently made their way into the spotlight, with a video from 2019 showing Gensler describing the SEC’s position on spot ETF products at the time as “inconsistent.”

The SEC has a storied history of denying spot Bitcoin ETF applications, a trend that first began in 2017.

This legacy has been carried on by Gensler since he was appointed head of the SEC in 2021. Since then, Gensler’s SEC has either delayed, denied or pushed back all applications for a spot Bitcoin ETF product, citing concerns with investor protections.

In June 2022, the Gensler-led SEC was sued by crypto asset manager Grayscale for rejecting its bid to convert its existing Bitcoin trust into a spot ETF, with a court ruling that the SEC was “arbitrary and capricious” to reject the application. The SEC did not appeal the decision.

To date, the SEC has only approved ETF applications for Bitcoin and Ether (ETH) futures products, as it claims that spot products do not have sufficient safeguards to protect investors from market manipulation.

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