Several well-known Bitcoin exchange-traded funds (ETF) issuers recently held meetings with the Securities and Exchange Commission (SEC). As the final details for your products are clarified, the chances of approval increase.
On December 13, Bloomberg ETF analyst James Seyffart reported that four different issuers have met with the SEC in recent days regarding their Bitcoin product applications.
Building Bitcoin ETF Momentum
BlackRock met with federal regulators for the third time in as many weeks on December 12. Additionally, Grayscale, Franklin and Fidelity each had meetings with the SEC last week.
BlackRock recently revamped its spot Bitcoin ETF application to make it easier for large banks to participate. New fund shares have been created using cash instead of just using crypto assets.
The SEC has until January 15th to decide on BlackRock's application, with the final deadline scheduled for March 15th.
Both the Trading and Markets Department and the Corporate Finance Department were present at each of these meetings, Seyffart noted.
“These are the two divisions that will ultimately decide whether and when the 19b-4 and S-1 are approved or rejected,” he added.
Eric Balchunas, ETF expert, commented:
“Damn, the SEC is busier than Santa’s elves. BlackRock’s third meeting with them yesterday is, in my opinion, the most notable as everyone is waiting to see if they can convince the SEC to allow non-cash consideration in the first round of approvals.”
He noted that the third BlackRock meeting was attended by Rachel Aquirre, head of all U.S. iShares, while the rest were mostly lawyers.
“How come they don’t invite market makers to these things?” he asked.
Read more: How to Prepare for a Bitcoin ETF: A Step-by-Step Approach
Meanwhile, ETF Store President Nate Geraci spoke with Valkyrie's Steven McClurg, who said things are “very close” in the ETF competition.
The SEC has no other major issues other than issue/redemption of shares, he said. Additionally, Valkyrie products are ready to launch and the backend ETF infrastructure is in place.
Additionally, he noted that the possible approval date could be any time after January 2nd. However, analysts including the aforementioned pair are eyeing January 10 for batch approvals.
$100 billion inflows are an extreme
In addition to those already mentioned, Bitwise, VanEck, WisdomTree, Invesco Galaxy and Hashdex are also in the ETF race.
Commenting on the impact of a potential $100 billion inflow into BTC following ETF approval, Seyffart said:
“I think that’s probably an overestimation of demand. Gold ETFs have been around in the U.S. since 2004 and currently have approximately $95 billion in assets here.”
He added that spot Bitcoin ETFs generating so many inflows “would be an EXTREMELY exceptional case of success, even if measured over multiple years.”
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