How far are we from Bitcoin spot ETFs?

Question

*Original | Odaily Planet Daily**Author | Qin Xiaofeng*! [How far are we from a Bitcoin spot ETF?] ](https://img-cdn.gateio.im/resized-social/moments-7f230462a9-0b444ed853-dd1a6f-69ad2a)On Monday night, the fake news that "SEC approved bitcoin spot ETF" caused the crypto market to experience an illusory and short-lived "bull market". Looking closely, the key factor in the success of this scam is the manipulation of the market by using information bias at a critical time in the ETF decision.In fact, according to the original timeline, October 16 and 17 are the deadlines for the SEC to make a resolution on the Bitcoin spot ETF owned by six companies, including BlackRock, Bitwise and Invesco. However, on September 27 and 29, the SEC issued documents that postponed the above-mentioned ETF decision. It is only misleading that due to the lag in the spread of market news, crypto market investors do not have a comprehensive understanding of ETF-related movements, which is misleading.Back to the original question, how far are we from the advent of a Bitcoin spot ETF? The answer to this question needs to be from two dimensions: one is the time process, and the other is the regulatory attitude.### (1) The ETF approval process is long, and ARK & 21 Shares has become a bellwetherFrom the ETF process, the maximum time is 240 days, and the SEC must make the final decision whether to approve or reject. Let's take the ARK 21 Shares Bitcoin ETF, which is currently the fastest moving TRIP, as an example to review its application process to help readers understand. Throughout the application, multiple time points arise, as follows:* On April 25, 2023, Cboe BZX Exchange filed with the SEC for the listing and trading of shares of the ARK 21 Shares Bitcoin ETF (this is the initial filing time and the beginning of a new round of project filing) and submitted the corresponding rule changes.* On May 15, 2023, the ARK 21 Shares Bitcoin ETF with the rule changes was officially published in the Federal Register for comments, marking the official start of the ETF approval process and the SEC must make a resolution up to 240 days (180+ 60) from that date.* The first review period is 45 days, which means that the SEC must make an order by June 29, 2023: agree, deny or extend; Ultimately, the SEC issued a directive on June 15 that an extension was required. The ARK 21 Shares Bitcoin ETF has since filed three amendments to the proposed rule changes in response to the SEC's challenge.* The second review period is 45 days, meaning the SEC must make an order by August 13, 2023; Ultimately, the SEC decided on August 11 to proceed with the extension.* The third review period is 90 days, meaning the SEC must make the decision by November 11, 2023. On September 27, the SEC issued an announcement extending the deadline for the ETF's resolution by another 60 days (on a Nov. 11 basis) to January 10, 2024. "The Commission considers it appropriate to designate a longer period for making a decision in order to allow sufficient time to consider the proposed rule changes".The Bitcoin spot ETFs of several other large asset management companies were basically announced on July 18 or 19, much later than ARK & 21 Shares' products, and were also extended by the SEC in its September 27 and 29 announcements (the original resolution was scheduled to be October 16~17). Odaily Planet Daily counts the decision time nodes of each ETF, as follows:! [How far are we from a Bitcoin spot ETF?] ](https://img-cdn.gateio.im/resized-social/moments-7f230462a9-e77a10ab34-dd1a6f-69ad2a)As can be seen from the figure above, the nearest Global X Bitcoin Trust is November 21, 2023, but it is estimated that it will also be delayed. After all, its application is the latest, and it has only entered the second round of review, and the others have already entered the third round and are unlikely to be prioritized. The more important timing is around mid-January next year, when there will be 8 ETFs waiting for a decision.**It is important to note that the approval of the ARK 21 Shares Bitcoin ETF will become a bellwether. **January 10, 2023 is the final time for approval of the ARK 21 Shares Bitcoin ETF. If rejected, ARK 21 Shares will have to go through the process all over again, starting a lengthy 240-day review period, just like they experienced in 2022; The deeper impact is that the other few are not immune, and can basically announce the basic death of this round of spot ETF applications in advance - although the final decision of the latter ETFs is in mid-March next year.Of course, if ARK 21 Shares is successfully approved, it is likely that several others will be approved at the same time, and the SEC will not allow one institution to gain a significant first-mover advantage. Therefore, investors need to keep a close eye on ARK 21 Shares from late 2023 to early 2024.### (2) A more positive regulatory attitude, a good signThe waiting in the process is actually a dominant feature, and the more critical factor behind it is the attitude of the regulator SEC. Today, the SEC's attitude towards Bitcoin spot ETFs is no longer negative.First, instead of simply and rudely postponing or rejecting applications for ETFs, as in the past, they will actively communicate and dialogue, sending emails to issuers asking them to explain or update the terms and conditions. Take the latest update of ARK, which involves a lot of new content, such as discussions on net asset value calculation, custody of crypto assets, and so on. Other SEC concerns include exchange fraud, concerns about liquidity and transparency in the Bitcoin market, and more.While these issues are cumbersome, they are important and may be discussed back and forth with issuers by the SEC — and although this will delay approval to some extent, it is inevitable. Although we will not see the introduction of spot ETFs anytime soon, the attitude is very positive.**Second, the SEC does not appeal grayscale. **The SEC has won and lost its own battle with Grayscale, and the court judgment in August this year did not completely side with Grayscale to rule that the SEC lost; For the SEC, which has always been tough, such an outcome is obviously unacceptable, and appeals seem to be the right thing to do. However, the SEC did not take any action until the October 14 appeal deadline. This change in attitude also paved the way for the next application of Grayscale GBTC to be converted into a spot ETF, and also opened the door for more Bitcoin spot ETFs.One possible reason for this shift is that traditional asset management giants such as BlackRock, Fidelity and Invesco have entered the market to play a unique role in government regulation, while also allowing the SEC to alleviate concerns about the future market.### Concluding remarksFor the landing of the Bitcoin spot ETF, the market's expectations are also optimistic.Spot prices may not reflect direct investor enthusiasm for spot ETFs, but GBTC can, which is currently at a discount of 14.78%, the lowest level since late December 2021, and continues to narrow, implying that traditional market investors are acknowledging the expectations of spot ETFs.Cathie Wood, CEO of Ark Invest, said that he believes the probability of the US SEC approving a bitcoin spot ETF may be rising. She predicted that multiple Bitcoin ETFs could be approved by the end of 2023 or early 2024, and predicted that Ark Invest is expected to be the first to be approved, and that "multiple (corporate) Bitcoin ETFs may be approved at the same time."