The U.S. Securities and Exchange Commission (SEC) is on the brink of approving the first spot bitcoin exchange-traded funds (ETFs) in the country. This milestone comes after extensive discussions on Friday between investment management firms, stock exchanges, and the SEC. Executives and representatives from five firms, preferring anonymity, shared that final adjustments to the S-1 prospectus documents required for ETF approval are underway.
Issuers expect to receive approval for these documents by late Tuesday or Wednesday. The SEC has requested what three issuers termed as “minor” modifications. These include amendments regarding fee disclosures and market-maker identities for the ETFs, with a submission deadline set for Monday morning.
While the SEC remains tight-lipped about individual filings, the process is moving swiftly. Exchanges have also been collaborating with regulators to complete 19b-4 filings, which outline necessary rule changes for launching spot bitcoin ETFs. By Friday, revisions to 11 of these filings were submitted.
Insiders indicate that issuers who met year-end filing deadlines might see approvals by January 10. This is a significant date as it marks the deadline for the SEC to decide on the Ark/21Shares ETF, currently at the front of the queue.
Despite multiple asset managers, including heavyweights like BlackRock, Fidelity, and WisdomTree, applying for spot bitcoin ETFs since 2013, the SEC has historically rejected these proposals over concerns of market manipulation. However, fourteen firms submitted applications last year and are now awaiting the SEC’s decision.
In an unusual request, the SEC has asked issuers aiming for a launch next week to also prepare written requests to expedite the effective dates of their ETFs. Normally, such discussions are more informal. Bloomberg earlier reported that SEC commissioners might vote on the 19b-4 rule changes next week, with a possible vote occurring on Wednesday, as mentioned by a source from one of the issuers.
