Approve, deny, delay? SEC to weigh in on more planned bitcoin ETFs this week
US regulator set to initially address proposals by BlackRock, Fidelity, Bitwise and others after delaying its decision on the proposed Ark 21Shares Bitcoin ETF
K.unshu/Shutterstock modified by Blockworks
The spot bitcoin ETF pursuit saga is set to continue this week, with the US Securities and Exchange Commission set to rule on, or delay its decision for, a range of funds from BlackRock and others.
BlackRock, which manages more than $9 trillion, piqued industry intrigue in June when it filed for an ETF that would hold bitcoin directly. The SEC published the fund proposal in the federal register on July 19, starting a 240-day clock for the commission to rule on the product.
But during the 240-day review process, the regulator faces key deadlines — at 45, 45, 90 and 60 days — when it submits a filing approving, denying or delaying a decision. The four periods add up to a cumulative 240 days, after which the SEC can no longer delay the decision.
Sept. 2 marks 45 days from July 19. The same deadline applies to planned bitcoin ETFs by Fidelity, VanEck, Invesco and WisdomTree.
A spot bitcoin ETF proposal by crypto-focused fund group Bitwise hit the federal register July 18, making the SEC’s initial deadline to address that proposal Sept. 1. The SEC’s initial 45-day deadline to respond to a bitcoin ETF filing by Valkyrie is Sept. 4.
But despite initial deadlines to address these products in the pipeline, various industry observers have said they aren’t expecting an approval this early in the 240-day process, if it comes at all.
The SEC asked for more time earlier this month to review a bitcoin ETF by Ark Invest and 21Shares — a decision Ark Invest CEO Cathie Wood said she expected. The regulator stated in an Aug. 11 filing that it would “institute proceedings” to determine whether it should approve or deny the fund, including the solicitation of public comments.
If the SEC took the full 240 days to rule on each proposal, the product by Ark and 21Shares would be permitted or rejected on Jan. 10. A decision on the rest of the bitcoin ETFs would follow in mid-March.
Bloomberg Intelligence analyst James Seyffart said in an Aug. 15 tweet that he would be watching the Jan. 10 deadline for potential approval. He added, however, that a ruling in favor of Grayscale Investments in its suit against the SEC could spur a range of bitcoin ETF approvals sooner than that.
Grayscale had sued the regulator in June 2022 after the regulator blocked it from converting its Bitcoin Trust (GBTC) to an ETF. A decision by the DC Circuit Court of Appeals is imminent.
Bitwise CEO Matt Hougan said during a webinar on Aug. 8 that while spot bitcoin ETF approval “could come at any point,” he believes it is more likely to come during the fourth quarter of 2023 or the first quarter of next year.
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