Spot Bitcoin ETF Applications Facing Regulatory Discussions
In recent discussions, Eric Balchunas, Bloomberg’s senior ETF analyst, disclosed ongoing talks between the U.S. Securities and Exchange Commission (SEC) and exchanges concerning spot Bitcoin ETF applications.
Balchunas mentioned that the SEC’s Trading & Markets division has been actively engaged in discussions with exchanges, specifically addressing 19b-4s related to spot Bitcoin ETFs.
The SEC has reportedly advised exchanges to consider cash creates instead of in-kind transactions and has encouraged them to submit amendments in the coming weeks. Although not entirely surprising, this involvement is seen as a positive sign for the industry.
Bitcoin Price Spike and SEC’s Preference for Cash Creates
Following these developments, the price of Bitcoin saw an $800 increase. Balchunas pointed out that the SEC’s preference for cash creates aligns with the restrictions that broker-dealers face in directly dealing with Bitcoin.
Choosing cash creates places the responsibility on ETF issuers to transact in Bitcoin, eliminating the need for broker-dealers to engage unregistered subsidiaries or third-party firms when dealing with Bitcoin.
He wrote on X, “Only 2-3 filers had planned cash creates, the rest wanted to do in-kind. So may have to adjust or risk delay. Anyway, this doesn’t change our 90% odds up or down but is a good sign the process is advancing and the SEC has a path forward in the plumbing that they are comfortable with.”
Balchunas explained that initially, only 2-3 filers had intended to use cash creates, while the majority favored in-kind transactions. This could mean adjustments are necessary for those aiming to comply with the SEC’s guidance or risk potential delays in their applications. He clarified that while these developments don’t significantly affect the 90% probability for or against spot Bitcoin ETF approval, they signal positive progress in the SEC’s approach.
Journey Towards Regulatory Progress
James Seyffart, an ETF analyst, added to the conversation, noting that the latest update on the spot Bitcoin ETF situation doesn’t bring fundamental changes but indicates ongoing progress, signaling forward movement in the regulatory process.
In recent developments, Eric Balchunas, Bloomberg’s senior ETF analyst, took to social media and opened up about the ongoing discussions between the U.S. Securities and Exchange Commission (SEC) and exchanges regarding spot Bitcoin ETF applications.
Balchunas noted that the SEC’s Trading & Markets division has been actively involved in talks with exchanges this week, specifically addressing 19b-4s related to spot Bitcoin ETFs.
The SEC is reportedly advising exchanges to opt for cash creates, as opposed to in-kind transactions, and has encouraged them to submit amendments in the coming weeks. While not entirely unexpected, this engagement is viewed as a positive sign for the industry.
Following these latest developments, the price of Bitcoin experienced an $800 spike. Balchunas explained that the SEC’s preference for cash creates, makes sense because broker-dealers are restricted from dealing directly in Bitcoin.
Opting for cash creates, places the responsibility on ETF issuers to transact in Bitcoin, eliminating the need for broker-dealers to involve unregistered subsidiaries or third-party firms when dealing with Bitcoin.
He wrote on X, “Only 2-3 filers had planned cash creates, the rest wanted to do in-kind. So may have to adjust or risk delay. Anyway, this doesn’t change our 90% odds up or down but is good sign the process marching and SEC has a path fwd in the plumbing that they are comfortable with.”
Balchunas pointed out that, initially, only 2-3 filers had planned to use cash creates, while the majority preferred in-kind transactions.
This may necessitate adjustments for those seeking to adhere to the SEC’s guidance or face potential delays in their applications. He clarified that while these developments don’t significantly alter the 90% probability for or against spot Bitcoin ETF approval, they indicate positive progress in the SEC’s approach and comfort level with the evolving landscape.
Adding to the conversation, ETF analyst James Seyffart noted that the latest update on the spot Bitcoin ETF situation doesn’t bring groundbreaking changes but hints that progress is indeed ongoing, signaling forward movement in the regulatory process.
Hot Take
The ongoing discussions and engagement between the SEC and exchanges regarding spot Bitcoin ETF applications indicate positive progress in the regulatory path, offering hope for the industry and signaling forward movement in the development of cryptocurrency trading.
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