This year, there has been significant buzz surrounding Bitcoin spot exchange-traded funds [ETFs], with many prominent industry participants joining in. The U.S. Securities and Exchange Commission [SEC] is known for its consistent pattern of postponing crypto ETF proposals, and it appears that the trend will continue in 2023.
In a notice dated Sept. 26, the SEC announced its intention to extend the timeframe for considering the approval or disapproval. This modification is related to enabling the ARK 21Shares Bitcoin spot ETF to be listed on the Cboe BZX Exchange. The SEC’s filing further read,
“The Commission designates January 10, 2024, as the date by which the Commission shall either approve or disapprove the proposed rule change.”
The previous extension, granted on Aug. 11, had provided the regulatory authority with a timeframe until Nov. 11 to render a decision concerning approval, disapproval, or an additional delay. It’s worth mentioning that notable companies such as BlackRock have also encountered a delay, with their deadline initially set for Oct. 17, but it is anticipated to be postponed once more.
After the most recent postponement, James Seyffart, an ETF analyst at Bloomberg, appears to have become quite pessimistic. He observed that these delays may have dashed any remaining expectations of a Bitcoin ETF receiving approval this year.
Can lawmakers push the SEC to allow spot Bitcoin ETFs?
In a recent letter, a bipartisan group of lawmakers, including Representative Mike Flood [R-Neb.], Tom Emmer [R-Minn.], Ritchie Torres [D-N.Y.], and Wiley Nickel [D-N.C.], urged SEC Chair Gary Gensler to promptly approve the listing of a Bitcoin ETF based on a recent significant court ruling. They asserted that allowing regulated spot Bitcoin ETF listings would enhance investor protection. According to them, it improves the transparency and safety of Bitcoin access. The letter further read,
“Congress has a duty to ensure the SEC approves investment products that meet the requirements set out by Congress. To that end, we urge you to approve the listing of spot-bitcoin ETPs immediately.”
The legislators made a comparison between a spot Bitcoin exchange-traded product [ETP] and a Bitcoin futures ETP, asserting that they are virtually identical. Consequently, they argued that the SEC’s current stance is unsustainable going forward. Bloomberg analyst Seyffart is speculating if the SEC’s latest move had anything to do with this letter.