A Bitcoin Exchange-Traded Fund (ETF) is an investment vehicle traded publicly. It has the same value are the underlying asset, which is BTC. Proponents of Bitcoin ETFs believe that the technicality around crypto wallets and exchanges has discouraged many investors from joining crypto. But with Bitcoin ETFs, they will be able to invest in BTC without the need to own the digital asset.
There are several Bitcoin Futures ETFs in the United States, but the Securities and Exchange Commission (SEC) hasn’t approved any Bitcoin Spot ETFs. The agency has always argued that such ETFs may lead to market manipulation.
Let’s take a look at some of the top Bitcoin Spot ETF applications submitted in June to the SEC.
BlackRock, the World’s biggest asset manager, filed for Bitcoin Spot ETF on June 14, a move that shocked the traditional finance sphere. The company named Coinbase and BNY Mellon as its crypto custodian and cash custodian, respectively.
A few days after the application, ETF analyst Eric Balchunas disclosed that BlackRock had 575 ETFs approved by the SEC, losing only once. Therefore, he said there was a huge chance that the agency will approve the firm’s latest application. However, it did not take long before the SEC claimed that BlackRock’s application was not clear enough. The asset manager then quickly refiled its application, entering an agreement with crypto exchange Coinbase to be its “surveillance-sharing” partner. On July 17, the SEC announced it was considering BlackRock’s application for official review.
This asset management company already runs a Bitcoin Spot ETF in Switzerland. WisdomTree filed for one with the SEC in early 2021, proposing to list it on Cboe BZx Exchange. However, the SEC turned down the application on November 2021, citing various concerns.
In June 2023, WisdomTree drew inspiration from BlackRock to file another Bitcoin Spot ETF. But it has yet to reach the review stage as of this writing.
Invesco Galaxy Bitcoin ETF
Invesco and Galaxy Digital partnered in September 2021 to file for a Bitcoin Spot ETF that was to be backed by BTC. With Invesco being the fourth-biggest ETF provider in the US, many were optimistic that the SEC would approve the joint ETF application, but that never happened. The two companies made another application on June 20, 2023.
Valkyrie submitted its first Bitcoin Spot ETF application on January 22, 2021. In the filing, the firm proposed Xapo as its crypto custodian and NYSE as the exchange on which the ETF will be listed. At the time, Valkyrie acknowledged BTC’s volatility, a major factor that has made the SEC hesitate to approve a Bitcoin Spot ETF. The company said it understood that wild price swings could negatively affect the value of the ETF.
Nonetheless, the SEC dismissed Valkyrie’s application on December 22, 2021. But the firm got approval for a Bitcoin Mining ETF the following month. On June 21, 2023, Valkyrie made a fresh application for a Bitcoin Spot ETF.
Cathie Wood’s investment company Ark Invest filed its first Bitcoin Spot ETF application on June 28, 2021. Six months later, it was rejected by the SEC. On April 21, 2022, the company filed another application that got rejected at the start of this year. However, Ark Invest did not give up as it made its third Bitcoin Spot application on June 27, 2023, including an undisclosed crypto exchange as its surveillance-sharing partner.
VanEck is among the earliest applicants of Bitcoin ETFs. It made its first filing in 2018, then withdrew it in August 2019. The following year, the company filed its second application a few days after Jay Clayton, the SEC ex-chair, had left office. At the time, Clayton was interviewed by CNBC, where he said concerns over price manipulation had to be addressed for a Bitcoin Spot ETF to be approved.
VanEck’s second application was later rejected by the Gensler-led SEC on November 11, 2021. The company submitted another Bitcoin Spot ETF filing in late June this year.
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