First Deadlines for Approval of 7 Bitcoin ETFs by SEC Approaching in the Next Week

Crypto News– The United States Securities and Exchange Commission (SEC) is currently facing imminent deadlines for determining the fate of seven applications for exchange-traded funds (ETFs) linked to spot Bitcoin (BTC) prices. These deadlines are particularly significant given the recent legal setback the SEC experienced in a U.S. federal appeals court against Grayscale Investments.

First Deadlines for Approval of 7 Bitcoin ETFs by SEC Approaching in the Next Week

Bitwise, an investment firm, will discover on September 1st whether its ETF will secure the coveted approval from the SEC. Following suit, other industry giants including BlackRock, VanEck, Fidelity, Invesco, and WisdomTree, will be on tenterhooks awaiting the SEC’s verdicts for their respective funds by September 2nd, as stated in multiple SEC filings.

Concurrently, Valkyrie is poised to receive the SEC’s response on September 4th. Although the U.S. Court of Appeals deemed the SEC’s rejection of Grayscale’s application to convert its Grayscale Bitcoin Trust (GBTC) into a spot Bitcoin ETF as “arbitrary and capricious” on August 29th, this doesn’t inherently mandate the SEC’s approval for Grayscale or other applicants in the future, according to Bloomberg’s ETF analyst James Seyffart.

During an August 29th interview with Bloomberg, Seyffart elucidated that Grayscale’s legal triumph “undoubtedly” improves the prospects of success for the upcoming wave of applicants. However, he remains uncertain about the timeline for such developments, as the SEC retains the prerogative to delay its decisions. Additionally, the regulatory body has allocated two more potential deadlines for each fund before reaching a binding verdict on the 240th-day post-filing.

For these hopeful applicants, the ultimate deadlines for the SEC’s decisions are all situated in the middle of March next year.

What Choices Does the SEC Have Following the Grayscale Verdict?

In the wake of the favorable ruling for Grayscale on August 29th, the regulatory body possesses a 90-day window to either file an appeal with the U.S. Supreme Court or seek an en banc review, enabling a full circuit court to overturn a verdict issued by a three-judge panel.

Nonetheless, the SEC’s subsequent course of action remains shrouded in uncertainty.

Should the SEC opt against an appeal, the court will be tasked with outlining the implementation of its ruling. This could involve directing the SEC to grant approval for Grayscale’s application, or at the very least, reevaluate it. In this regard, Seyffart has identified two principal pathways for the regulatory authority.

Firstly, the SEC might concede defeat and greenlight Grayscale’s conversion of its Grayscale Bitcoin Trust (GBTC) into a Bitcoin spot ETF.

Alternatively, the SEC would have to undertake the substantial action of either rescinding the listing of Bitcoin futures ETFs altogether or rejecting Grayscale’s application on the grounds of a fresh argument, Seyffart noted. However, Eric Balchunas, another ETF analyst at Bloomberg, finds the prospect of the SEC withdrawing Bitcoin futures ETF listings as “highly unlikely,” especially given the reported willingness of the SEC to entertain Ethereum futures ETFs.

This is not an exaggeration. The possibility of a company offering a Bitcoin spot ETF has the potential to open up access for individuals in the traditional financial sphere to invest in the cryptocurrency market using their existing investment platforms. Esteemed firms such as Fidelity and Vanguard, which often manage retirement assets, could be among those offering such services.

Introducing Bitcoin to the traditional financial market through a framework that is already comprehensively understood in terms of operation, trading, and fees holds the promise of generating substantial demand for the cryptocurrency in the short term. This heightened interest could subsequently drive the ETF to acquire more Bitcoin to meet the increased demand, thereby altering the supply dynamics of the crypto market. With elevated demand and a static supply, the result could be a surge in Bitcoin’s price.

When Grayscale’s application was denied slightly over a year ago, Michael Sonnenshein, the CEO of the company, expressed profound disappointment and a strong disagreement with the SEC’s ruling.