Several firms have made progress in their pursuit of a spot Bitcoin exchange-traded fund (ETF) in the United States. The applications from BlackRock, Fidelity, Invesco Galaxy, VanEck, and WisdomTree have been published in the Federal Register, which is the official journal of the U.S. government. This marks a significant step forward in the process, as it allows the U.S. Securities and Exchange Commission (SEC) to review and make a decision on the applications.
The publication of the applications in the Federal Register followed the initial filing in June. The firms had to file amended applications after reports emerged that the SEC deemed the original filings insufficient. The amended applications included naming Coinbase, a cryptocurrency firm, as a surveillance-sharing partner. This move was aimed at addressing any concerns the SEC may have had regarding the custody of Bitcoin.
In addition to the five firms mentioned above, Bitwise also filed an application for a spot BTC ETF, which was published in the Federal Register on July 18. Furthermore, Valkyrie is expected to file its application on July 21. The SEC now has an initial window of 45 days to review the applications and reach a decision. However, the commission also has the option of extending the process for up to 240 days, which would delay the final approval or denial until March 2024.
It is worth noting that while the SEC has allowed ETFs linked to Bitcoin futures since 2021, it has not yet approved a spot investment vehicle with direct exposure to cryptocurrencies like Bitcoin. The launch of the leveraged Bitcoin futures ETF by the Volatility Shares Trust in June was one of the first of its kind in the United States.
The SEC’s handling of cryptocurrency-related matters has come under scrutiny from regulators, lawmakers, and the general public. The agency has faced criticism for its regulation by enforcement action approach, as well as a federal court ruling that deemed the XRP token not to be a security. Both Binance and Coinbase have also been targeted by lawsuits from the SEC in 2023.
The decision on whether to approve these spot Bitcoin ETF applications will have significant implications for the cryptocurrency market. If approved, it would make it easier for investors to gain exposure to Bitcoin through traditional financial instruments. This could potentially lead to increased adoption and further integration of cryptocurrencies into the mainstream financial system.
In conclusion, the publication of spot Bitcoin ETF applications in the Federal Register represents a significant step forward in the regulatory process. The SEC now has the opportunity to review the applications and make a decision on their approval. The outcome of this decision will have far-reaching consequences for the cryptocurrency market and its relationship with traditional financial markets.
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