Media: SEC allows the possibility of approving spot BTC ETFs in early January

What’s new? The US Securities and Exchange Commission (SEC) has recommended that several investment firms submit final applications to launch spot bitcoin exchange-traded funds (ETFs) by December 29. This was reported by Fox Business reporters following a meeting between officials and representatives of firms that expect to receive approval to launch next January, including BlackRock, Grayscale, ARK Invest, and 21Shares. Specifically, the deadline for a ruling on the joint application ARK Invest and 21Shares filed in April is January 10.

Material by Reuters

What else is known? Currently, only futures-based cryptocurrency ETFs are authorized in the United States. The SEC has repeatedly rejected and delayed rulings on spot product applications due to risks of market manipulation.

That said, in August, a federal appeals court called the SEC’s refusal to launch such products inconsistent because both futures and spot ETFs carry similar risks. The decision was made as part of the proceedings against Grayscale, which challenged the refusal of officials to convert the bitcoin trust into a spot fund.

Since then, the SEC has met repeatedly with representatives of investment firms to jointly adjust the filings. Grayscale CEO Michael Sonnenschein called those talks productive.

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According to representatives of several companies at the last meeting, the commission may approve a number of applications in the first working days of 2024. The final versions of the applications should specify the amounts of funds for launching the funds and providing liquidity, as well as fees for trading in shares. So far, only ARK Invest and 21Shares have disclosed the fees, and they will be 0,8%.

The joint product between ARK Invest and 21 Shares has already been assigned the ARKB ticker and code number in the Depository Trust and Clearing Corporation’s (DTCC) database, which handles trades for the Nasdaq stock exchange. The product from BlackRock is also listed in the DTCC database under the ticker IBIT. The updated filing from the major investment firm also includes a condition that the shares be redeemed in cash rather than bitcoin.

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Earlier, ETF Store president Nate Geraci noted that lower fees for trading exchange-traded fund shares compared to crypto exchanges’ transaction fees would turn into a “bloodbath” for the latter.