The Deadline for Spot Bitcoin ETF Filings
Major asset managers rushed to submit their revised spot bitcoin exchange-traded fund (ETF) filings before the deadline set by the U.S. Securities and Exchange Commission (SEC). The SEC required applicants to update their registration statements (S-1) by Friday in order to be considered for the first wave of spot bitcoin ETF approvals in early January.
Authorized Participants in the Filings
Several asset managers, including Blackrock, Vaneck, Valkyrie, Bitwise, Invesco/Galaxy, Fidelity, Wisdomtree, and the Ark Investments and 21shares joint filing, submitted their updated documents to the SEC. The securities regulator specifically requested that authorized participants (APs), which are financial institutions responsible for managing the creation and redemption of ETF shares in the primary market, be named in the amended filings.
Blackrock Takes the Lead
Blackrock became the first major asset manager to disclose the authorized participants for its spot bitcoin ETF. The company named Jane Street and JPMorgan as its APs. Bloomberg ETF analyst Eric Balchunas noted that other filings may not necessarily include AP names, but Blackrock’s disclosure sets the standard.
Other Asset Managers and their Authorized Participants
Other asset managers, such as Valkyrie, Fidelity, and Wisdomtree, also named their authorized participants in the filings. Valkyrie named Jane Street and Cantor Fitzgerald, while Fidelity named Jane Street. Invesco/Galaxy waived its fees for the first six months and named Virtu and JPMorgan as its authorized participants.
Challenges for Authorized Participants
One challenge for asset managers is that the SEC not only requires APs to be named in the documents but also to serve as the underwriter of the ETF. This requirement may make APs hesitant due to potential lawsuits and risks associated with the newness of the asset class.
Hot Take: The Race for Spot Bitcoin ETFs
Major asset managers have submitted updated filings for spot bitcoin ETFs as they compete to be among the first ones approved by the SEC. Blackrock has taken the lead by disclosing its authorized participants, with other asset managers following suit. This development marks a significant step forward in the establishment of regulated investment products for cryptocurrencies. However, challenges persist as the SEC requires APs to serve as underwriters, adding additional complexity to the process. It remains to be seen which asset manager will be the first to launch a spot bitcoin ETF and pave the way for widespread adoption of digital assets.
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