Biting into Bitcoin: ETF Applications in the Race

Several high-profile firms have thrown their hats into the Bitcoin (BTC) exchange-traded fund (ETF) ring, as their applications have officially landed in the Federal Register. This is not just a bureaucratic step, it’s like putting on your dancing shoes before hitting the floor—albeit a rather serious ballroom where the U.S. Securities and Exchange Commission (SEC) reigns supreme.

Who’s in the Mix?

Firms such as BlackRock, Fidelity, Invesco Galaxy, VanEck, and WisdomTree are among those pushing their applications through the governmental hoop. Not surprisingly, prompted by the dusty reports updated on July 19, the SEC now has the delightful task of deciding whether to give these applications the green light, delay the decision, or let the public weigh in. Oh, the drama!

What’s the Procedure?

So what happens next? After their initial filings in June—think of it as the first date—these firms have now named Coinbase as their go-to partner for surveillance sharing, following an SEC declaration that the earlier proposals were, well, just not a match. The excitement doesn’t stop there; just the day before these heavyweights showed up, Bitwise had its own spot BTC ETF application published. As if that weren’t enough, Valkyrie is expected to jump into the fray by July 21. Who knew watching ETF filings could rival a soap opera?

How Long Do They Have to Wait?

Once a proposal hits the register, the SEC is allowed a cozy 45-day window to mull over its decision. But, if they’re feeling particularly indecisive, they can stretch that out to a whopping 240 days. Yes, you read that right. We’re all waiting with bated breath as these firms face the possibility of decisions being pushed until March 2024—no pressure, right?

The SEC’s Stance on Cryptocurrencies

Despite some fans lining up for a chance at a spot ETF, the SEC has remained tight-lipped in approving any direct investment vehicles that involve cryptocurrencies. However, they’ve dabbed in Bitcoin futures ETFs since 2021, which means they’re somewhat open to the idea—just not too eager yet. Recently, the launch of a leveraged Bitcoin futures ETF by the Volatility Shares Trust caught everyone’s eye, making many wonder when the SEC will get onboard the spot ETF train.

The Bigger Picture

While the market anxiously awaits the outcomes, there’s a little underlying tension as well. The SEC faces scrutiny from fellow regulators and lawmakers, especially after a federal court ruling suggested that the XRP token isn’t a security. With enforcement actions against crypto firms like Binance and Coinbase, it’s clear the SEC is juggling significant balls in the air. Will this lead to a change in their approach to Bitcoin ETFs? Only time—and that 240-day window—will tell.