SEC and Fidelity Discuss Spot Bitcoin ETF Application
The US Securities and Exchange Commission (SEC) recently held a meeting with Fidelity Investment to discuss the company’s application for a spot Bitcoin exchange-traded fund (ETF). This meeting is part of the SEC’s engagements with various asset managers seeking approval for similar products, indicating potential approvals in the future.
Fidelity Presents Bitcoin ETF Workflows
During the meeting, Fidelity presented its Bitcoin ETF workflows, showcasing the operational model of its Wise Origin Bitcoin Trust. The presentation highlighted the importance of enabling physical creation and redemption to enhance trading efficiency and secondary market pricing for all participants. Fidelity also emphasized that arbitrage and hedge are more efficient with physical creations and suggested self-clearing ETF market-maker firms as Agency Authorized Participants (AP) to improve efficient arbitrage.
Fidelity Updates Spot ETF Filing
Following the meeting, Fidelity has updated its filing with the SEC by submitting an updated S-1 form. This comes after Fidelity listed its spot Bitcoin ETF with the Depository Trust and Clearing Corporation (DTCC), adding to the growing optimism surrounding potential approval.
The Plot Thickens In The Spot Bitcoin ETF Saga
The approval of a spot Bitcoin ETF continues to generate interest, as it is expected to drive institutional demand for Bitcoin. Analysts predict that the approval could lead to a significant price surge, potentially surpassing $100,000. Apart from Fidelity Investments, the SEC has also met with other asset managers such as BlackRock, Grayscale, and Invesco, who are also interested in launching spot Bitcoin ETFs.
Potential Approvals and Timeline
Discussions between the SEC and these asset managers have focused on technical aspects of the proposed ETF, including custody arrangements, investor risk disclosure, and creation and redemption mechanisms. Analysts, including Bloomberg’s James Seyffart, suggest that the likeliest timeline for spot Bitcoin ETF approvals is between January 5 and January 10, with the potential for up to nine applications to be approved within this timeframe.
Hot Take: Anticipation Builds for Spot Bitcoin ETF Approvals
The ongoing discussions between the SEC and asset managers like Fidelity Investment indicate a growing possibility of spot Bitcoin ETF approvals. This development has sparked anticipation among investors and analysts who foresee institutional demand and a potential surge in Bitcoin’s price. With various prominent players updating their applications and a potential approval timeline set for early January, the crypto market eagerly awaits the SEC’s decision on these groundbreaking investment products.
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