One Week Before Potential Approval of Spot Bitcoin ETF: What You Should Know
Sources within the US Securities and Exchange Commission (SEC) are suggesting that they could begin notifying spot Bitcoin exchange-traded fund (ETF) applicants of approvals as early as Friday. The recent filing of an 8A securities registration form by Grayscale Investments and Fidelity Investments has generated excitement surrounding the potential approval.
According to Bloomberg analyst James Seyffart, successful applicants could launch their ETFs within days, contrary to previous beliefs that it would take weeks. The approval dates are scheduled for January 8 – January 10, 2023, nearly a decade after the first attempt was made.
The buzz around these approvals has been accompanied by a flurry of filings discussing authorized partners and securities registration. Eric Balchunas, an analyst at Bloomberg, predicted that companies would rush to name authorized partners leading up to the approval deadline.
Seyffart clarifies that the 8A form filed by Grayscale and Fidelity is simply part of the ETF listing process and should not be interpreted as a sign of approval. The effectiveness of the filing depends on the applicant’s S-1 filing, which in turn relies on the SEC approving a 19b-4 form.
Grayscale’s efforts have garnered attention due to its position as a pioneer in bringing Bitcoin to institutional investors through its Bitcoin Trust. The company fought hard to overturn the SEC’s initial refusal to allow the conversion of the Trust into a spot Bitcoin ETF. Grayscale CEO Michael Sonnenshein supports the approval of multiple ETFs simultaneously, emphasizing the need for an equal playing field and advocating for allowing approved applicants to enter the market promptly.
As the approval deadline approaches, market players have expressed various opinions. Nate Geraci, an ETF investment adviser, suggests that if the SEC does not approve spot Bitcoin ETF applications, legal action could follow. Simeon Hyman of ProShares, when questioned about the potential threat of a spot ETF to the Bitcoin futures market, asserts that the futures market is well-regulated and not at risk. However, crypto investment provider Matrixport’s report, which downplayed the chances of ETF approval based on political reasons, prompted a significant Bitcoin selloff.
Brian Kelly, Founder & CEO of BKCM LLC, a digital asset investment firm, predicts an inevitable selloff once ETF excitement reaches a peak. Kelly believes this dip would present a buying opportunity as many individuals still haven’t been able to include Bitcoin in their portfolios.
Overall, the cryptocurrency market eagerly awaits the potential approval of spot Bitcoin ETFs, with market players preparing for various outcomes and potential impacts.