Brief Approval Window Opens for spot Bitcoin ETF Applicants, 90% Chance of Approval by January
The United States Securities and Exchange Commission (SEC) has opened a brief window of opportunity for approval of a spot Bitcoin exchange-traded fund (ETF). It is expected that the applicants will have a 90% chance of approval by the end of January, 2021.
The ETF applications must be approved by the SEC, which last week signaled its approval. A spot Bitcoin ETF is a fund that tracks the price of Bitcoin on the open market and allows investors to gain exposure to Bitcoin without actually owning Bitcoin itself. This new asset class could become an important driver for the entire cryptocurrency industry.
However, in order to be approved, the applicants must meet all the SEC’s criteria for the ETF. The applicants must provide the SEC with sufficient evidence of the trustworthiness of the product and its underlying management. The SEC also requires a financial statement audit report and other due diligence documentation.
Assuming the applicants meet the requirements, analysts expect the ETF to be approved before the end of January. This would make the ETF eligible to start trading on the market as early as autumn 2021.
The approval of a spot Bitcoin ETF could have a significant impact on the cryptocurrency industry. It is expected to lead to a surge in institutional investment and liquidity, helping to make the industry more mature and opening it up to larger retail investors. Additionally, the ETF may also help to reduce volatility by providing additional market stability.