Observers are eagerly awaiting a potential announcement surrounding the possibility of a Bitcoin exchange-traded fund (ETF) on Friday. On October 20, a District of Columbia court is set to issue a mandate that could solidify an August opinion in favor of Grayscale, which sought to convert its Bitcoin trust (GBTC) into an ETF. The US Securities and Exchange Commission (SEC) recently decided not to appeal the previous ruling, creating anticipation for the next steps in the process.
Anticipation for the Next Steps
Industry analysts, including Elliott Stein and James Seyffart of Bloomberg Intelligence, anticipate some announcement or additional information from the SEC, Grayscale, or the courts regarding the next course of action. “We are waiting on some sort of announcement or just additional information from the SEC, Grayscale or possibly the courts on what happens next,” said Seyffart.
Progress regarding the conversion of Grayscale’s GBTC into an ETF could bring much-needed clarity to the ETF approval process, which has been shrouded in uncertainty. Many industry watchers have been unsure how the SEC would handle Grayscale’s proceedings and the numerous other outstanding ETF applications. For one, crypto investor Michael Novogratz expressed his belief that the SEC would approve a Bitcoin ETF this year.
Grayscale has argued that converting GBTC into an ETF could unlock significant value for its holders. While the SEC has been hesitant in the past, several companies, including BlackRock and Invesco, are currently vying to launch their own ETF products. Galaxy Digital, led by Novogratz, is partnering with Invesco on a proposal. Bloomberg Intelligence suggests that the most likely scenario is that Grayscale’s application will be approved simultaneously with those of other issuers like BlackRock.
ARK Investment Management’s Cathie Wood has echoed similar sentiments, advocating for the SEC to green-light multiple applications at once. In a recent interview, SEC Chair Gary Gensler mostly avoided giving any firm answers regarding the potential launch date of spot Bitcoin ETFs. However, he did talk about the disclosure review team, claiming that the agency has been responding and giving feedback to issuers.
Ongoing Discussions and Amendments
As reported, Fidelity Investments, one of the world’s largest asset management firms, has filed an amendment application to its proposed Wise Origin Bitcoin Trust. The amendment addresses crucial aspects such as the secure custody of customers’ Bitcoin holdings and the disclosure of risks associated with the regulatory landscape surrounding cryptocurrencies. Fidelity’s move follows similar actions by Ark Invest and Invesco, who recently amended their own filings for spot Bitcoin ETFs.
These developments indicate ongoing discussions between prospective ETF providers and the SEC, leading to a surge in optimistic sentiment among traders and market observers.
