The United States is on track to approve its first spot Bitcoin (BTC) exchange-traded fund (ETF) by February 2024, according to Mike Novogratz, the CEO of Galaxy Digital. Novogratz cited sources from asset management firms BlackRock and Invesco during Galaxy Digital’s Q2 earnings call on August 8.
Novogratz stated that the approval of a Bitcoin ETF is a significant development. He mentioned that both BlackRock and Invesco believe it is not a question of if, but when the ETF will be approved. He estimated that the timeline for approval is likely within the next four to six months.
Galaxy Digital, which reported a $46 million net loss in Q2, is one of the contenders for a spot Bitcoin ETF. The company reapplied for the ETF in June in partnership with Invesco, a $1.5 trillion asset manager and the fourth-largest ETF issuer in the U.S.
Novogratz did not provide a specific comment on when the ETF’s approval can be expected, as the decision rests with the Securities and Exchange Commission (SEC). However, he believes that once approved, BlackRock and Invesco, along with Galaxy Digital, will fiercely compete for market share.
In response to a question, Galaxy Digital President Chris Ferraro added that the SEC might approve a potential Bitcoin ETF to avoid being labeled as “obstructionist.” He suggested that the approval would demonstrate the SEC’s openness to cryptocurrencies.
The approval of spot Bitcoin ETFs may arrive even sooner if a judge rules in favor of Grayscale in its lawsuit against the SEC. Grayscale sued the SEC last year after its application to convert its Grayscale Bitcoin Trust into a spot ETF was rejected. Analysts speculate that if Grayscale wins the case, other spot Bitcoin ETF applicants could receive approvals simultaneously.
The potential approval of a Bitcoin ETF is highly anticipated in the crypto community. It would provide traditional investors with a regulated way to gain exposure to Bitcoin, potentially leading to increased adoption and liquidity. The news of BlackRock and Invesco’s filings, combined with Galaxy Digital’s reapplication, indicates a growing interest from major players in the ETF space.
Overall, market participants eagerly await the SEC’s decision on Bitcoin ETFs. The approval of such ETFs would mark a significant milestone for the cryptocurrency industry and could have far-reaching implications for the broader financial markets.