Source: DALL·E
This week marks a potentially transformative moment for cryptocurrency as the U.S. Securities and Exchange Commission (SEC) is expected to make a key decision on the approval of several spot Bitcoin exchange-traded funds (ETFs).
The SEC’s decision, due by Jan. 10, will determine the fate of multiple Bitcoin ETF applications, including those from major financial players such as BlackRock and Fidelity. The issuers would have until Monday morning to submit their final revisions.
Spot Bitcoin ETFs on the Verge of SEC Approval
To initiate the trading of a spot Bitcoin ETF, the SEC must first approve the 19b-4 filings provided by the exchanges planning to list these ETFs. Subsequently, the regulator must also approve the S-1 registration applications prior to the launch.
As the SEC is expected to decide on both the 19b-4 and S-1 filings, the Bitcoin ETFs can be listed and start trading on exchanges as soon as the next business day once approved, hypothetically Jan. 11. According to Bloomberg Intelligence ETF analyst Eric Balchunas, the SEC has never voted on the decision.
“The SEC has never voted on bitcoin ETFs (spot denials or the futures approvals),” said Balchunas in a social media post. the applications “were denied or approved via ‘Delegated Authority’ … which would make sense here too since this has been a ‘10th floor’ driven initiative since the Grayscale win.”
Re the “but the SEC hasn’t voted” and how that’s some kind of poss rug pull. Few things, the SEC has never voted on bitcoin ETFs (spot denials or the futures approvals), they were denied or approved via “Delegated Authority” (see below from commish Peirce speech) which would make… pic.twitter.com/X8pzQchexj
— Eric Balchunas (@EricBalchunas) January 6, 2024
Even if there were a vote, it is unlikely for the SEC Chair Gary Gensler to vote no for two reasons, “a) there’s no basis to deny,” said Balchunas. “And b) he is literally the one who directed the Staff to put in thousands of man hours to work w 11 issuers on 5-10 rounds of comments.”
Awaiting Fee Disclosures and Bitcoin Ownership
The ETF Store President Nate Geraci shared what he will be watching this week regarding spot Bitcoin ETFs. And the first thing that came in mind is the pending disclosure of the unrevealed fees.
“Especially from BlackRock & Grayscale. Can’t overstate importance of fees in this competition,” said Geraci, “Fidelity current leader at 0.39%. Invesco at 0.59% (though waiving fee for first 6mos).”
Source: James Seyffart
Balchunas also reinstated that when one invests in a spot Bitcoin ETF, they do own the Bitcoin that has been deposited with the designated custodian.
“It is true when you sell you can’t get btc back but no one who would use an ETF wants btc back- they’d rather have USD,” said Balchunas in another post. “For the true believers who want to own btc directly, you SHOULD.”
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