Checking the latest progress of 13 Bitcoin spot ETF proposals Will SEC make a decision next month?

Keeping Up with the Latest Updates on 13 Bitcoin Spot ETF Proposals Will the SEC Reach a Decision Next Month?

Source: Blockworks

Compiled by: LianGuaiBitpushNews Mary Liu

Industry professionals are full of confidence, eagerly awaiting the US Securities and Exchange Commission (SEC) to make a decision on the approval of a spot Bitcoin ETF next month. Swan Bitcoin CEO Cory Klippsten predicted in an interview with Bloomberg that the window for approval may have narrowed down to January 8th, 9th, or 10th, 2024.

A list compiled by Bloomberg Intelligence analyst James Seyffart shows that there are currently 13 proposed spot Bitcoin ETFs submitted to the SEC.

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This article will summarize the latest developments of these 13 spot Bitcoin ETF proposals.

Grayscale

According to industry observers, Grayscale Investments defeated the SEC in court in August, which has made people more optimistic about the approval of a spot Bitcoin ETF.

At that time, the judge ruled that the regulatory agency’s refusal to convert the Grayscale Bitcoin Trust (GBTC) into an ETF but allowing the launch of ETFs based on Bitcoin futures was “arbitrary and capricious.” The SEC chose not to challenge this ruling.

Grayscale stated that GBTC is ready to operate as an ETF once approved by regulatory bodies and emphasized that it will “work quickly with the SEC.”

In a blog post on December 1st, Grayscale noted that while the timeline for spot Bitcoin ETF approval is “essentially uncertain,” the company believes it is “a matter of time, not whether.”

Chief legal officer Craig Salm stated in the post that if Grayscale receives SEC approval, the company plans to immediately transfer GBTC from the OTCQX market to NYSE Arca.

The company indicated that the conversions, issuances, and redemptions that will occur simultaneously as part of the ETF conversion process will essentially eliminate any discounts or premiums historically held by the stock and enable the trust to closely track the value of BTC.

Ark Invest/21Shares

Those following the race for a Bitcoin ETF should be familiar with their names. Ark Invest and 21Shares first collaborated on a proposed spot Bitcoin fund in 2021.

The application was rejected in March 2022 and again in February 2023, and the latest reapplication was made in April, ahead of asset management giant BlackRock and other companies.

It is expected that the SEC will make a ruling on the latest submission on January 10th, and some industry observers believe that on that day, the regulatory agency will also decide the fate of similar proposals from other issuers.

Ark CEO Cathie Wood stated, “We indeed believe that while we are first in line, many companies will be approved simultaneously, and depending on the specifics of how they submitted, there could be more than six applications approved at once.”

Both parties updated the Bitcoin ETF application for the third time on November 20th, stating that the sponsor fee for Bitcoin held in the trust is 0.80%. The fund’s shares will be traded on the Cboe BZK exchange with the ticker symbol ARKB.

BlackRock

BlackRock is a financial giant that manages approximately $9 trillion in assets. The company joined the race for a spot Bitcoin ETF in June, prompting many other firms to increase their bids for such products.

The proposed iShares Bitcoin Trust by BlackRock will use the ticker symbol IBTC and trade on NASDAQ.

Last month, the company held multiple meetings with officials from the Securities and Exchange Commission’s Division of Trading and Markets. Its November 20th meeting notice outlined the differences between the physical and cash redemption models.

Authorized participants for different ETFs engage in the creation and redemption of shares using two primary methods: physical or cash trades.

Through a physical trade, APs exchange ETF shares for a corresponding basket of securities that reflects the ETF’s holdings. For cash trades, APs create or redeem shares in exchange for cash instead of securities.

A document dated November 28th, the same day as another meeting, stated that “the Securities and Exchange Commission has certain outstanding questions regarding the physical model.”

The latest amendment to the proposal submitted by BlackRock on Monday states that the trust fund will only accept physical creation and redemption requests from authorized participants and market makers with implemented compliance programs.

The updated filing also added information regarding the company’s plan to raise $100,000 in seed funding for the fund.

Bitwise

Bitwise’s latest S-1 amendment was released on the same day as BlackRock’s. The Bitwise Bitcoin ETF (previously known as the Bitwise Bitcoin ETP Trust) will trade on NYSE Arca with the ticker symbol BITB.

Bloomberg analysts said, “The Securities and Exchange Commission and these issuers have put in a lot of effort to resolve issues, and these filings may be the result of repeated dialogue and extensive work hours.”

Bitwise Chief Investment Officer Matt Hougan noted that the dialogue between issuers and the SEC is “one reason why this time does feel different than a few months ago.”

Like other firms, Bitwise has been hoping to launch a spot Bitcoin ETF for years.

The company submitted a more than 100-page white paper in October 2021, which indicated that the CME Bitcoin futures market leads the spot market and unregulated Bitcoin futures market. Additional research published suggests that the new Bitcoin ETP is unlikely to have a significant impact on CME Bitcoin futures market prices.

Bitwise addressed eight points of contention raised by the SEC in its previous application in a filing submitted in September.

VanEck

VanEck updated the S-1 form for its VanEck Bitcoin Trust for the fifth time on Friday. The disclosure states that the fund’s ticker symbol is HODL.

HODL will be traded on Cboe. The latest disclosed information does not reveal the proposed product’s fees.

VanEck has hired Gemini Trust Company as the Bitcoin custodian for its ETF – which is different from most companies that choose Coinbase as their custodial partner.

Matthew Sigel, VanEck’s Director of Digital Asset Research, stated in June that the SEC should approve all Bitcoin Spot ETFs immediately.

Sigel and VanEck Investment Analyst Patrick Bush wrote on Thursday that they expect such products to be approved in the first quarter. They estimate that the initial influx into Bitcoin Spot ETFs will be around $1 billion, reaching $2.4 billion in the first quarter.

WisdomTree

After BlackRock’s application, WisdomTree refiled its Bitcoin Spot ETF in June.

The company manages approximately $98 billion in assets and stated in its disclosure, “The Bitcoin market has matured, with operational efficiency and scale comparable to mature global equity, fixed income, and commodity markets.”

WisdomTree modified its Bitcoin ETF application on November 16th. The fund’s shares will be traded on the Cboe BZK Exchange with the ticker symbol BTCW.

Will Peck, WisdomTree’s Head of Digital Assets, said during the company’s October earnings call, “There does appear to be some exciting momentum [and] we remain very focused on Bitcoin Spot ETFs.” “We believe this is the best way to execute this asset class through the traditional channels in the United States, and we look forward to continuing to collaborate with regulatory agencies on this.”

Invesco

Invesco also followed BlackRock’s lead and refiled its Bitcoin Spot ETF in June. The proposed ETF will be listed on the Cboe BZX Exchange. The application was submitted in partnership with Galaxy Digital, reflecting the Bitcoin ETF application they submitted in 2021.

The company made modifications to its application earlier this fall, indicating that it will continue dialogue with regulatory agencies as they consider the decision.

According to the Depository Trust & Clearing Corporation’s list, the ticker symbol is BTCO.

Fidelity

Fidelity, as a refiler, has joined the current Bitcoin Spot ETF race, similar to Invesco and Ark. One of the reasons that set its proposed Bitcoin ETF apart is its custodian: Fidelity Digital Assets Services. Unlike some competitors, it does not use Coinbase.

Fidelity Digital Assets has been offering custody and trade execution services since 2018, making it the obvious choice for the company’s in-house custody.

The proposal was first submitted in late June, which means it came right after BlackRock. As early as 2021, Fidelity applied for a spot Bitcoin ETF, but it was blocked by the SEC in January last year.

According to the DTCC list, the fund will trade under the code FBTC. Like Invesco, it will be listed on the Chicago Options Exchange.

Valkyrie

Valkyrie applied for a spot Bitcoin ETF at the end of June, just a few days before Fidelity.

The company has also made multiple modifications to its proposal. Unlike some of the other applicants, Valkyrie seems to be interested in the stock code BRRR, which stands for “money printer.”

This ETF will be listed on Nasdaq along with the proposed ETF by BlackRock. These two funds are the only ones listed on Nasdaq. Coinbase, as expected, is listed as the proposed custodian of the fund.

The last time the SEC postponed Valkyrie’s application was at the end of September, and the next deadline is after the “golden window” proposed by Seyffart.

Steven McClurg, Chief Investment Officer of Valkyrie, said in an interview with Schwab Network that he believes the price of Bitcoin (whether through halving or the potential launch of a spot Bitcoin ETF) could reach $100,000 next year.

Global X

Another “returnee,” Global X applied for a spot Bitcoin ETF in early 2021 and then applied for another one in August.

Like other companies, it plans to be listed on the Cboe exchange and have Coinbase as the custodian. The initial application submitted to the SEC listed Coinbase as a monitoring sharing partner, which was seen as an appeasement to regulatory agencies.

The application was delayed as early as November, which is not surprising as the SEC stated that it needed more time to consider the application.

Prior to the delay, Bloomberg analyst Eric Balchunas posted on X that the SEC had discussions with potential spot Bitcoin ETF issuers regarding adding cash creation in the proposed ETF 19b-4 application. The analyst stated that these discussions were a “good sign.”

Hashdex

Hashdex applied to hold spot Bitcoin in its Bitcoin futures ETF at the end of August. The application was updated to Hashdex Bitcoin ETF “to reflect the fund’s updated investment strategy.”

It is one of the few companies that do not rely on Coinbase as a monitoring sharing partner. Instead, it chooses to use the physical market trading exchange of CME to “source and settle” Bitcoin. It will also hold spot Bitcoin, Bitcoin futures contracts, and cash and cash equivalents. If converted, it will be listed on the New York Stock Exchange along with Grayscale.

The updated fund will trade under its futures code DEFI.

Franklin Templeton

Financial services giant Franklin Templeton also joined the race for a spot Bitcoin ETF in September. It seeks to list its fund on the Cboe BZX Exchange. Like most other applicants, the company chose Coinbase as its custodian.

The proposed Bitcoin ETF’s comment period began in late November, which has led some to believe that the SEC’s early solicitation of comments increases the likelihood of approval in early January.

In its initial proposal, Franklin Templeton wrote that the ETF would become a “series” within the Franklin Templeton Digital Holdings Trust.

LianGuaindo Asset Management

As the latest participant in the spot Bitcoin ETF race, LianGuaindo submitted its proposal on November 29th. If approved by the SEC, the ETF will be listed on Cboe – the exchange chosen by 8 out of the 13 applicant companies.

The Swiss asset management company formally included itself in the competition by officially submitting a 19b-4 earlier this week.

While the company trades various crypto products on the six major Swiss exchanges, this would be their first venture into issuing a crypto ETF in the United States.

Coinbase will serve as the fund’s custodian, and LianGuaindo appointed Mellon Bank of New York as the trustee. Due to the late application, it remains unclear if LianGuaindo will be able to launch the ETF simultaneously with BlackRock or Ark if approved.

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