SEC in Final Talks on Bitcoin ETFs, Industry Insiders Claim

The SEC may be nearing a decision on Bitcoin ETFs, several industry insiders involved in the talks claim.

Gary Gensler looking out of his office window, thinking hard.
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  • SEC and asset managers discuss key details of Bitcoin ETFs.
  • August court decision influences SEC’s approach to Bitcoin ETFs.
  • SEC’s decision on ARK’s Bitcoin ETF filing is due by January 10.

Crypto markets are seeing bullish momentum in anticipation of the U.S. Securities and Exchange Commission (SEC) key decision. Now, the long-awaited decision on spot Bitcoin exchange-traded funds (ETFs) could soon become a reality.  

Latest reports claim that the is engaging deeply in discussions over spot Bitcoin ETFs. Key industry players like Grayscale Investments, BlackRock, Invesco, and ARK Investments are at the forefront of these talks, each with pending applications that could redefine the landscape of crypto-investing. 

Bitcoin ETF Approval Talks in Key Stage

In the wake of an influential court ruling in August, which questioned the SEC’s previous rejection of Grayscale’s ETF application, the regulator has intensified its engagement with potential ETF issuers, according to reports on Thursday, December 7. 

The focus of these discussions spans several critical areas. These include custody arrangements, mechanisms for creation and redemption, and comprehensive investor risk disclosures.

 These dialogues, insiders claim, indicate the SEC is nearing the end of the ETF application process. This is key, as a positive outcome could mark a watershed moment in the crypto world.

If the SEC approves its first Spot Bitcoin ETF, investors would have a regulated pathway to Bitcoin investment through the stock market. The anticipation is palpable, with predictions of a surge in demand, potentially reaching up to $3 billion in the initial days post-approval.

Bitcoin Spot EFT Faces Complex Path to Approval

However, the path to approval is laden with complexities. The SEC’s longstanding concerns about Bitcoin’s susceptibility to market manipulation remain a focal point. Moreover, the nature of settlement mechanisms—cash-based or “in-kind”—is still debated among issuers.

The first SEC decision, the one on ARK’s application, is expected by January 10. This application could set the tone for the fate of the other 12 applications. 

Still, the recent Bitcoin price rally suggests market optimism about the possible approval of ETFs.

On the Flipside

  • The SEC’s apprehension about ensuring investor protection in a highly volatile market remains a significant challenge for ETF issuers.
  • Introducing Bitcoin ETFs brings complex technological and operational challenges, including developing robust custody and redemption mechanisms.

Why This Matters

The SEC’s potential approval of Bitcoin ETFs signifies a pivotal moment in blending traditional finance with digital assets. This development also reflects how traditional regulatory frameworks are adapting to accommodate new technological advancements

Read more about the Bitcoin EFT Hype: 
Bitcoin Surges Past $42k as ETF FOMO Kicks In

Read more about Binance’s new Web3 wallet: 
Binance Web3 Wallet Now Supports Bitcoin, Dogecoin and More 

This article is for information purposes only and should not be considered trading or investment advice. Nothing herein shall be construed as financial, legal, or tax advice. Trading forex, cryptocurrencies, and CFDs pose a considerable risk of loss.

Author
David Marsanic

David Marsanic is a journalist for DailyCoin who covers the intersection of crypto, traditional finance, and government. He focuses on institutionalized crypto entities like major cryptocurrency exchanges and Solana, breaking down complex topics into easy-to-understand writing. David's prior experience as a business journalist at various crypto and traditional news sites has enabled him to maintain a critical approach to news while adhering to high journalistic integrity standards.