Worldsfeed Tech Desk: A series of pivotal deadlines this week marks the culmination of a long-standing effort to introduce Bitcoin-backed exchange-traded funds (ETFs) in the United States. Potential Bitcoin ETF issuers have until Monday morning in Washington to submit any final revisions to their pending applications, as reported by Bloomberg News. The US Securities and Exchange Commission (SEC) has its own deadline of January 10 to make decisions on at least one of these applications, with speculation within the crypto industry suggesting that the regulator might announce multiple decisions simultaneously.
Two essential prerequisites must be met before a Bitcoin ETF, backed by actual Bitcoin holdings, can commence trading. Firstly, the SEC must approve the 19b-4 filings submitted by exchanges seeking to list the ETFs. Secondly, the regulator must give the green light to the relevant S-1 forms, the registration applications submitted by prospective issuers, including major players like BlackRock and Fidelity.
Bloomberg News reports that the SEC is set to vote on the exchanges’ filings, the 19b-4s, in the coming days. Following this, the regulator may or may not take action on the issuers’ applications, the S-1s, around the same time. If the SEC grants both sets of necessary approvals, the ETFs could begin trading as early as the next business day.
A representative from the SEC declined to comment on the status of the applications.
The potential impact of Bitcoin ETFs, supported by the leading cryptocurrency, is hailed as a landmark moment for digital assets by proponents. Billions of dollars are at stake, representing potential inflows from both retail and institutional investors.
Michael Anderson, co-founder of crypto venture firm Framework Ventures, emphasizes, “The market is still seriously underestimating the potential impact of a Bitcoin ETF approval.”
However, past SEC leadership, both under Democrat Gary Gensler and Trump-era predecessor Jay Clayton, has consistently rejected the launch of such a product, citing concerns about investor protection and the risk of market manipulation.
Speculation has grown since August, following the SEC’s loss in a crucial legal battle against crypto asset manager Grayscale Investments, that the regulator may yield to the increasing demand for this product.
Market expectations of regulatory approval have fueled a roughly 160% surge in Bitcoin prices last year. Nevertheless, this surge was insufficient to reclaim the record highs set in November 2021 when Bitcoin reached nearly $69,000. The cryptocurrency has maintained a relatively narrow range around $44,000 since the beginning of 2024. As of 6:02 a.m. on Monday in London, it experienced a marginal 1.5% decline to $43,640, aligning with a broader dip in crypto markets at the start of the workweek.