Bitcoin ETF Launch to Face Delay Even After SEC Approval, Predict Analysts
Summary:
Despite the U.S. Securities and Exchange Commission (SEC) opening its first window for approval of a Bitcoin ETF, analysts predict the actual launch could be delayed by a month even after approval. This is due to the two-step process required for starting a Bitcoin ETF, which involves getting approval from both the Trading and Markets and Corporate Finance divisions of the SEC. Speculation about the potential delay comes as the SEC opens an 8-day window, from November 8-17, to approve the first spot Bitcoin ETF. However, some experts forecast that the actual approval might not occur until early next year.
Analysts point out that even once a Bitcoin ETF receives the US Securities and Exchange Commission's (SEC) green light, the actual launch would still be a month away. This delay post SEC's approval owes to the two-pronged procedure involved in initiating a Bitcoin ETF. In this process, a Bitcoin ETF issuer has to secure approvals from both the SEC's Trading and Markets division on the 19b-4 filing, and the Corporate Finance division on the S-1 filing, also known as the prospectus. The Corporate Finance division mainly concentrates on the specifics of fund operations and risk disclosures. Among the 12 Bitcoin ETF applications submitted, nine have displayed revised prospectuses, indicating they have liaised with the Corporate Finance department. Market observers anticipate a delay in the Bitcoin ETF launch if the 19b-4 approvals are granted ahead of the signing off of the prospectus documents. Bloomberg ETF analyst, James Seyffart, brought to attention that even if 19b-4 obtains approval, the sanction of S-1s and subsequent ETF launch might take several weeks or even months.
The SEC's first opportunity to give thumbs up to a spot Bitcoin ETF opens for eight days, from Nov. 8 to Nov. 17. Despite the market experts' collective confidence lifting approval chances upto 90%, they predict that the actual approval may not be handed down until early next year.
Previously, the SEC prolonged the deadline for comments on the spot Bitcoin ETF, extending the commentary period until Nov. 8. The race for a spot Bitcoin ETF kickstarted in the U.S when BlackRock, the world's top asset manager, lodged its application. Other asset managers, such as Fidelity, have also submitted applications for Bitcoin ETFs, however, most faced denials or ended up retracting their applications. The current cycle of 2023-24, nonetheless, has stirred market experts to forecast a potential endorsement for the spot ETF, showing a confidence rate as high as 90%.
Published At
11/9/2023 10:32:33 AM
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