This week is poised to be pivotal for the long-awaited approval of exchange-traded funds (ETFs) backed by Bitcoin in the United States, with a series of high-stakes deadlines approaching. Bitcoin ETF hopefuls have until Monday morning in Washington to submit any final revisions to their pending applications, as reported by Bloomberg News. Meanwhile, the US Securities and Exchange Commission (SEC) has until January 10 to make a decision on at least one of these applications, leading industry insiders to speculate that the regulator may announce multiple decisions simultaneously.
The approval of spot-backed Bitcoin ETFs hinges on two key technical requirements. Firstly, the SEC must greenlight the 19b-4 filings submitted by exchanges seeking to list the ETFs. Secondly, the regulator must approve the relevant S-1 forms, the registration applications from aspiring issuers, including major players like BlackRock and Fidelity.
Bloomberg News has reported that the SEC is expected to vote on the exchanges’ 19b-4 filings in the coming days. Subsequently, the regulator may or may not take action on the issuers’ S-1 applications around the same timeframe. If the SEC grants approvals for both sets of requirements, the Bitcoin ETFs could commence trading as early as the next business day.
Bitcoin proponents believe that ETFs backed by the largest cryptocurrency could mark a significant milestone for digital assets, attracting substantial investments from both retail and institutional investors. Michael Anderson, co-founder of crypto venture firm Framework Ventures, emphasized that the market is underestimating the potential impact of a Bitcoin ETF approval.
However, the SEC, under the leadership of both Democrat Gary Gensler and his Trump-era predecessor Jay Clayton, has previously declined to approve such products, citing concerns about investor protection and the risk of market manipulation. Speculation has been mounting since August, following the SEC’s legal setback against crypto asset manager Grayscale Investments, that the regulator may yield to the increasing demand for a Bitcoin ETF.
Market expectations of regulatory approval have contributed to a roughly 160% surge in Bitcoin’s value last year. Despite this, the cryptocurrency has not yet reached the record highs set in November 2021, when it approached almost $69,000. Bitcoin has been trading in a relatively narrow range around $44,000 since the beginning of 2024 and experienced a slight decline to $43,640 at the start of the working week.
