The Securities and Exchange Commission (SEC) is facing a significant influx of paperwork as the deadline for approving spot Bitcoin (BTC) ETFs approaches. As reported by Eleanor Terrett, a journalist for FOX Business, the approval of a spot Bitcoin ETF seems unlikely at this time due to vacations and an overwhelming workload.
“While the SEC is surely unpredictable, it would surprise me if approvals were to happen tomorrow,” Terrett said. “From what I understand through conversations I’ve had with issuers, the SEC still has to review all the changes made to the S-1s filed on Thursday/Friday AND make comments on them.”
Terrett’s comments were in response to speculation by crypto expert Scott Melker, who suggested the possibility of an approval today. However, Terrett compared the situation to the approval process for Ethereum futures in October 2023 and highlighted the tight timeline, considering the recent time off for SEC staff.
“If the SEC follows a similar approval timeline to the ETH futures in October, the agency will, after this round of reviews, communicate to the issuers a date they want the final S-1s to be filed and make them effective in the subsequent 24-48 hours. SEC staff has been off since Friday, so a Tuesday or even a Wednesday approval seems tight,” Terrett concluded.
Adding to the discussion, FOX Business journalist Charles Gasparino reported that sources at BlackRock indicated there had been no communication from the SEC. Terrett’s sources also suggested that the amount of paperwork the SEC still needs to go through makes an announcement towards the end of the week more likely. This further supports the notion that the SEC is currently overwhelmed with the workload, potentially causing a delay in the announcement.
The Timing of Approvals
If the SEC manages to approve the ETF proposals from firms like BlackRock, Fidelity, Invesco, Bitwise, and VanEck by January 5, they would be slightly ahead of the expected schedule. Bloomberg ETF analysts Eric Balchunas and James Seyffart had previously predicted that the SEC would likely approve a batch of spot Bitcoin ETFs closer to the end of the deadline.
“We are definitely expecting it by January 10. Still, I think the official date is more likely January 8th – 10th,” Seyffart recently commented.
The statement came in response to a Reuters report suggesting that the SEC might notify issuers of their clearance to launch spot Bitcoin ETFs as early as Tuesday or Wednesday, paving the way for a launch in the following week.
The SEC’s Approach and Collaborations
The SEC has historically denied or delayed spot Bitcoin ETFs due to concerns over market manipulation and investor protection. However, following a landmark lawsuit loss to Grayscale Investments in August, the agency began collaborating more closely with a dozen firms to explore the possibility of bringing such funds to the market.
Many industry participants, including Cathie Wood of ARK Invest, believe that the SEC will approve multiple applications simultaneously to prevent any single firm from gaining a first-mover advantage.
