SEC Announces Friday Deadline for Amending Spot Bitcoin ETFs Applications
In its recent announcement, the United States securities regulator has directed applicants for the spot Bitcoin exchange-traded funds (ETF) to amend their bids by Friday. The Securities and Exchange Commission (SEC) disclosed in a recent publication that fund managers pursuing spot Bitcoin ETFs will finalize such bids by Friday, December 29.
SEC Issues Friday Deadline Signaling Likely ETF Approval
The announcement by the Gary Gensler-chaired SEC signals that the regulator is in the final process of reviewing a dozen bids for spot Bitcoin ETF. Fox Business reporter Eleanor Terrett reflected on the update to inform the applicants that they have less than a week to finalize such an application.
The announcement will likely prompt a series of activity adjustments filed by various applicants, including Grayscale, Fidelity, Bitwise, Ark Invest, VanEck, and BlackRock. The adjustments will likely align with the SEC’s announcement portrayed in the disclosures following meetings with representatives drawn from Grayscale and BlackRock.
Terrett explained that the SEC obligates the applicants to finalize the amendment by Friday to secure their eligibility for inclusion in the inaugural wave of spot Bitcoin ETFs approval.
SEC Urges Exclusion of In-kind Creation in Amended Applications
The SEC reminded all applicants to exclude the inclusion of in-kind creation when submitting their amended applications. Failure to exclude such phrases risks nonconsideration of the bid alongside other competitors.
The variation of in-kind and cash-creation models has dominated recent deliberations involving potential ETF issuers and the SEC. The initial bid had most fund managers opting for the in-kind creations and redemption. Such variants would have allowed the fund to settle transactions directly by paying or receiving Bitcoins from investors.
Terrett observed that the SEC urged the applicants in their round-table talks to embrace the cash creation and redemption. The two involve acceptance and payment of cash to the investors.
The cash rendition eliminates the exposure to significant security risks arising during cryptocurrency transfer. The advisory has seen several potential ETF issuers adopt it to secure the SEC’s greenlight.
The conclusion of the exercise by Friday would end the months of speculations and contests involving SEC and applicants. However, the regulator is projected to review the final applications by January 10, when market observers consider it as the earliest approval date.
The approval of the spot Bitcoin ETFs is predicted to usher in a vast inflow of funds from the institutional and retail investors yet to have Bitcoin exposure.
The product would trigger an inflow of funds into Bitcoin that, since June, has witnessed bullish momentum. The period coincides with the revelation of BlackRock applying for the spot Bitcoin ETF in a move that stimulated a wave of bids from Wall Street firms in asset management.
BTC Market Activity Gears Up for ETF Approval News
The global largest digital assets token by market capitalization is riding on the looming approval of the spot Bitcoin ETFs. Although the price is driven by halving projected to occur in April 2024, the likely approval of the ETF has dictated the price levels throughout 2023.
Bitcoin price has sustained an uptrend in the awareness that the SEC is in its final review stages for the pending applications. Such is manifested in the Bitcoin that, at press time, is exchanging hands at 43,668.58, marking a 5.6% rally in the past week and an impressive 159.7% in 2023.
Although the crypto market saw a mild retracement, Bitcoin has gained 15.7% in the past month, with the community portraying a bullish outlook. Bitcoin retains its dominance in market activity, with its daily trading volume up 41.80% to realize $19.527 billion, thereby indicative of surging market activity.
Market observers are closing fingers on Bitcoin’s recovery path toward its all-time high of $69,045 in November 2021. Nonetheless, the price is 36.80% below its highest price.
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