Spot Bitcoin ETF Applicants Have Now Completed Important Procedures With the SEC

Key Points:

• US regulators advance the approval process for spot Bitcoin ETFs, instructing issuers to submit final 19b-4 filings.
• SEC staff reportedly gave no additional feedback on recent amendments, with a commissioner vote expected next week on exchange-rule filings.
• Spot Bitcoin ETF applicants adopt cash redemption in S-1 filings, deemed safer by the SEC, awaiting approval for final versions by Monday’s deadline.

According to Bloomberg, major progress has been made in the pursuit of spot Bitcoin exchange-traded funds (ETFs) gaining approval from US regulators.

US Regulators Clear Path for Spot Bitcoin ETF Applicants

The Securities and Exchange Commission (SEC) staff advised multiple exchanges and spot Bitcoin ETF applicants, including BlackRock, ARK/21 Shares, VanEck, Bitwise, Hashdex, WisdomTree, Franklin Templeton, Fidelity, Valkyrie, and Grayscale, to submit the final version of a crucial document, known as a 19b-4 filing, by Friday.

Sources familiar with the matter, requesting anonymity, disclosed that the SEC staff provided no additional feedback on the paperwork for several firms after the latest amendments. The 19b-4 filings propose rule changes on stock exchanges, paving the way for the trading of ETFs. The SEC commissioners are anticipated to vote on the exchange-rule filings next week, with the possibility of delegation to SEC staff without a formal vote.

In a recent development, spot Bitcoin ETF applicants modified their S-1 filings, opting for cash redemption instead of in-kind redemption. This entails converting Bitcoin back into cash before providing it to traders, a model widely accepted in the ETF industry and among Bitcoin futures ETFs, considered safer by the SEC.

Furthermore, spot Bitcoin ETF applicants are awaiting SEC approval for the final versions of their S-1 filings and the prospectus documents for the ETFs. The SEC set a deadline of Monday at 8 a.m. Washington time for updated S-1 filings. While approval of 19b-4 and S-1 forms may not necessarily coincide, the traditional sequence involves approval of 19b-4s preceding that of S-1s. The outcome of these deliberations will significantly impact the future of spot Bitcoin ETFs in the US market.