The appliance for a Bitcoin exchange-traded fund (ETF) has been postponed by the Securities and Exchange Commission (SEC) yet again, at least until the fall. Despite prior SEC reluctance, the momentum for cryptocurrency-related offerings persists in a resolute direction. The recent delay pertains to ARK 21Shares Bitcoin ETF, an initiative by ARK Investment Management led by Cathie Wood.
ARK, along with BlackRock, WisdomTree, and Invesco, seeks approval for spot Bitcoin storage funds, highlighting industry interest. Contrasting with current Bitcoin funds, it notably diverges by focusing on spot storage, unlike Grayscale Trust or ProShares futures.
Historically, the SEC cited concerns over crypto platforms’ anti-fraud and anti-manipulation safeguards when rejecting ETF applications. Recent submissions from fund companies do, however, contain clauses meant to resolve these problems.
The SEC’s most recent action involves asking for public input on a particular section of ARK’s application, which has caused a several-week delay. Yet, the US Court of Appeals for the D.C. is about to decide if the SEC’s reasoning against converting GBTC holds merit. Circuit. In a March hearing, judges questioned the disparate handling of Bitcoin futures ETFs versus spot Bitcoin applications.
Bitcoin ETF Momentum Amidst Regulatory Hurdles
The court is unlikely to order ETF clearance, but Grayscale’s win might prompt SEC to seek more denial justifications. In a worst-case scenario, the organization might even decide to withdraw its support for Bitcoin futures ETFs.
Despite challenges, the prevailing trend leans towards approving ETFs in the future. Cathie Wood anticipates multiple Bitcoin ETF approvals if SEC permits. ARK and the SEC both declined to comment.
Cryptocurrency insiders foresee Bitcoin ETFs driving substantial token demand and attracting billions in investments. The introduction of ETFs, according to some opponents, may draw investors’ attention away from other Bitcoin-related products.
It’s interesting to think that owners of GBTC would benefit from ETF approval the fastest. GBTC is now trading at a discount of about 25% to the value of its Bitcoin holdings; turning it into an ETF will effectively close this difference.
The journey to a Bitcoin ETF has been challenging, but ARK’s recent delay is seen as a minor obstacle, not a major setback. Legal clarity pursuit and Bitcoin ETF launch anticipation impact the dynamic cryptocurrency landscape in ongoing flux.