Bitcoin ETF: Updates Change the Game

The financial market is eagerly awaiting the possible approval of a bitcoin spot ETF. In this regard, Fidelity, Ark Invest, and Invesco have recently updated their requests with the SEC. This is in response to letters demanding clarification on the matter. The crypto community perceives this action as a positive sign of ongoing dialogue between the companies and the regulatory authority.

[PN] FIDELITY FILED AN UPDATED VERSION OF ITS SPOT BITCOIN ETF S-1 APPLICATION pic.twitter.com/duEj51Inyz

— Phoenix » PhoenixNews.io (@PhoenixTrades_) October 17, 2023

Increased Bitcoin ETF requests highlight growing interest in crypto

In recent years, there has been strong enthusiasm for Bitcoin, which is considered an iconic cryptocurrency. However, investing in BTC is often complex due to:

• Price volatility,
• Security risks,
• High fees,
• Technicality.

This is where the idea of a bitcoin spot ETF comes in. This type of crypto asset would allow investors to buy and sell shares of a fund that actually holds bitcoin. This concept offers many advantages, including:

• Simplicity,
• Liquidity,
• Transparency,
• Security,
• Regulatory compliance.

Approval of requests: The SEC examines 5 key elements

The modified Bitcoin ETF requests by Fidelity, Ark Invest, and Invesco highlight five key aspects that the SEC will closely scrutinize:

1. Mechanisms related to bitcoin hard fork”
2. Sources used to assess and set the price of bitcoin, with a focus on their compliance with accounting standards
3. Disclosure of risks associated with regulatory uncertainty
4. The environmental impact of bitcoin mining, an energy-intensive activity
5. Risks associated with the use of bitcoin in illegal transactions

These factors provide a better understanding of what the SEC is actually focusing on. They also provide clear guidance to applicants on how to address the regulator’s concerns. Despite these encouraging developments, it is unlikely that new applications will be submitted before the first quarter of 2024.

The potential approval of a bitcoin spot ETF is a hot topic in the financial market. With the recent updates to the requests, the pressure is mounting on Gary Gensler, the SEC chairman, for a long-awaited verdict. Although the outcome is uncertain, the demand continues to grow. In reality, the approval of a bitcoin spot ETF no longer seems to be a matter of “if” but “when.”