- The Securities and Exchange Commission has not yet determined its stance on Bitcoin ETFs.
- The commission had previously rejected several applications seeking approval.
- SEC chair Gary Gensler has revealed the factors influencing the commission’s deliberations.
The Securities and Exchange Commission (SEC) might shift from its tight-lipped approach to the spot Exchange-Traded Funds (ETFs) approval process as it deliberates its unyielding position.
While recent indicators point towards a potential approval, investors remain uncertain due to the commission’s unpredictable track record.
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Nevertheless, in a groundbreaking development, SEC Chair Gary Gensler has shed light on the commission’s new stance on spot ETF approvals, further sparking anticipation and excitement within the industry.
Court Rulings Prompted ‘New Look’ at ETFs
In a Thursday interview with CNBC, Gary Gensler addressed the surge in applications from various issuers looking to convert trusts and shares into spot Ethereum and Bitcoin ETFs.
Gensler acknowledged the historical denials of such applications by the SEC. However, he highlighted that recent court rulings have prompted a reevaluation of the commission’s stance on the proposals.
"We had in the past denied a number of these applications, but the courts here in the District of Columbia weighed in on that, so we're taking a new look at this based upon those court rulings,” he said.
Gensler’s comments come on the heels of predictions by industry experts and analysts that an approval is imminent, factoring in recent meetings between issuers and the commission.
ETF Approval Countdown
Despite the SEC’s reluctance to approve spot ETFs, the crypto community is buzzing with heightened anticipation for approval.
Bloomberg analyst Eric Balchunas emphasized that the commission is moving in baby steps, stating that the accelerated engagements with issuers hint at the strong possibility of approval.
He estimated a 75% chance of an approval happening by the end of this year, adding that the likelihood may increase further, potentially reaching higher odds if the deliberation extends into January 2024.
Analyst James Seyffart echoed his sentiment, forecasting an approval to come by January 10, 2024, and a chance of all 12 applications being approved simultaneously.
The heightened anticipation has fueled a market rally as Bitcoin and other crypto assets experienced significant price surges. As the days draw closer to a potential approval, Bitcoin, Cardano, Solana, and Ethereum have surged over 100% in this quarter alone, reaching levels last seen in 2022.
On the Flipside
- The SEC has received nearly 15 ETF applications so far.
- Despite the SEC’s recent comments, there’s uncertainty regarding what its ultimate decision would be.
- Per the SEC’s deadline extension, the deadline for a potential decision is January 25, 2024.
Why This Matters
Gensler’s comments imply a reassessment of the commission’s regulatory considerations surrounding spot ETFs, hinting at the potential for a favorable outcome.
Read more on the evolving regulatory standards within the industry:
Global Banking Committee Sets Stricter Stablecoins Criteria
To find out more about the SEC’s extension of Grayscale’s decision deadline, read here:
SEC Postpones Spot ETFs Verdict, Keeps Market On Edge
