- BlackRock, BitWise, Invesco, and Galaxy Bitcoin Spot ETF applications have received a delay order from the US SEC.
- This checks out four out of seven in the list, with the heft of BlackRock hinting at more delays to come.
- Bloomberg’s ETF specialist James Seyffart anticipates more delay orders within the next 48 hours ahead of a possible government shutdown.
The race for Bitcoin Spot Exchange-Traded Funds (ETF) continues, but the US Securities and Exchange Commission (SEC) is not showing any haste. Latest reports show a series of delays coming in ahead of a possible US government shutdown.
Also Read: Valkyrie Investment wins race to offer first ETH futures ETF
BlackRock among delayed BTC spot ETF applications
The BlackRock asset management company is among four of seven delayed decisions as market onlookers keep their eyes peeled on the US SEC to provide decisions for the many Bitcoin Spot ETF filings and re-filings already on its desk. Others include BitWise Investment, Invesco, and Galaxy, which had also applied to become issuers in the US.
AND here's @InvescoUS / @galaxyhq's spot #bitcoin eTf delay. Four down, Three to go https://t.co/fthrNCsrph pic.twitter.com/mlwu2fYT9o
— James Seyffart (@JSeyff) September 28, 2023
ETF specialist with Bloomberg Intelligence James Seyffart says, “This means we are expecting all Bitcoin ETF's squared in Magenta to get their delay orders today or tomorrow.” Seyffart attributes these early delay decisions to the fear of government shutdown.
This means we are expecting all #Bitcoin ETF's squared in Magenta to get their Delay orders today or tomorrow. (these are early due to the govt shutdown) https://t.co/DlXMEKhOAP pic.twitter.com/yCmeSO0p2z
— James Seyffart (@JSeyff) September 28, 2023
The series of delays invigorates speculation that a Spot Bitcoin ETF approval may not come until Q1 2024 at the earliest. This stance is bolstered by BlackRock, boasting over 98% in approval and its remarkable heft in the industry, not securing approval this far. Meanwhile, we are just about two weeks (15 days) until the SEC’s deadline to decide whether they are going to appeal their loss in the Grayscale Bitcoin Trust (GBTC) case. Otherwise, they would have to either provide an alternative reason for denial or approve the conversion of the GBTC to an ETF.
Ripple lawyer John Deaton has already lost hope for any BTC Spot ETF approval this year.
No Spot #Bitcom ETF for us in 2023, right @RepMaxineWaters. https://t.co/29tPIymvcr
— John E Deaton (@JohnEDeaton1) September 28, 2023
Meanwhile, there is speculation that the financial watchdog may have taken an unusual step by reaching out to issuers of BTC spot ETFs.
There's chatter that SEC reached out to the issuers, which has never happened bf in process, to go over (likely some plumbing issues). Good news IMO vs same ole same ole delay, radio silence then denial in Jan bc of (likely) custody (or something else)
— Eric Balchunas (@EricBalchunas) September 28, 2023
If there is any truth to this statement, then it could be a positive sign. Meanwhile, after four of seven, three decisions remain pending, WisdomTree, VanEck, and Fidelity.
US government shutdown, what this is about
The US government has hinted at a possible shutdown that could potentially see millions of federal staff and military employees either sent home or working absent pay. This may be imminent unless Congress achieves a final agreement. Failure to secure a deal will see the lion’s share of the federal government’s funding expire by midnight of Saturday.
It therefore poses a threat with the capacity to disrupt everything, starting with air travel, and payment benefits, and if push comes to shove, the precarious US economy may suffer an additional blow. Some call it a “low-grade civil war” in the US.
There is a low-grade civil war going on in the USA right now.
— Jeffrey A Tucker (@jeffreyatucker) September 28, 2023
The situation, an impasse rather, comes on the back of some hardline Republicans pushing back against short-term funding agreements. Congress on the other hand is bent on cutting down on spending. With this, some federal personnel are preparing for a lapse. Citing an excerpt from a note to the Department of Health and Human Services:
…reduced staffing across nearly every division for the duration of the lapse… pre-notified employees would be temporarily furloughed.
Besides the possibility of a funding lapse, the Federal Aviation Administration (FAA) is also facing the Saturday deadline for reauthorization. Nevertheless, it is not clear whether legislators will approve an FAA reauthorization law separately from the spending package.
Crypto ETF FAQs
What is an ETF?
An Exchange-Traded Fund (ETF) is an investment vehicle or an index that tracks the price of an underlying asset. ETFs can not only track a single asset, but a group of assets and sectors. For example, a Bitcoin ETF tracks Bitcoin’s price. ETF is a tool used by investors to gain exposure to a certain asset.
Is Bitcoin futures ETF approved?
Yes. The first Bitcoin futures ETF in the US was approved by the US Securities & Exchange Commission in October 2021. A total of seven Bitcoin futures ETFs have been approved, with more than 20 still waiting for the regulator’s permission. The SEC says that the cryptocurrency industry is new and subject to manipulation, which is why it has been delaying crypto-related futures ETFs for the last few years.
Is Bitcoin spot ETF approved?
Bitcoin spot ETF has been approved outside the US, but the SEC is yet to approve one in the country. After BlackRock filed for a Bitcoin spot ETF on June 15, the interest surrounding crypto ETFs has been renewed. Grayscale – whose application for a Bitcoin spot ETF was initially rejected by the SEC – got a victory in court, forcing the US regulator to review its proposal again. The SEC’s loss in this lawsuit has fueled hopes that a Bitcoin spot ETF might be approved by the end of the year.
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