The likelihood of having a spot market bitcoin ETF, or exchange-traded fund, ready to list on the market by year’s end is now a near certainty. After years of legal wrangling, the U.S. Securities and Exchange Commission (SEC) has run out the clock on applying to the U.S. Court of Appeals, which recently excoriated the securities regulator for its seemingly biased decision in approving a futures-based ETF while denying a substantively similar spot market-based product.
A spot market bitcoin ETF is something of a holy grail for the crypto industry, despite the fact that these stock market-traded financial funds already trade in Canada and Europe. The reason why has to do almost entirely with the SEC denying the dozens of applications its seen so far, putting it out of reach for U.S. investors looking for bitcoin exposure without buying bitcoin directly.
See also: In Canada, Spot Bitcoin ETFs Have Been Working for Years
For instance, Grayscale’s filing for a spot bitcoin ETF in October 2021 and its rejection by the U.S. Securities and Exchange Commission (SEC) in June 2022 made far fewer headlines than the August ruling by a three judge panel for the U.S. Court of Appeals that the regulator was “wrong.” News of the court’s ruling made tidal waves across the crypto and financial worlds because of what it could mean for BlackRock’s recent spot bitcoin ETF submission.
When one reads headlines such as “BlackRock: The Secret Company that Owns the World,” it’s no surprise that bitcoin’s price jumped 20% over the 11 days following the announcement from the world’s largest asset manager. The initial bump triggered optimistic enthusiasm about a future bull run.
Despite BlackRock’s 99.8% ETF approval record, it’s still unclear how the SEC will rule on this, given that it hasn’t approved any prior bitcoin ETFs and is aggressively targeting major U.S.-based crypto exchanges.
Nevertheless, the association of Bitcoin with BlackRock provides plenty of optimism among some Bitcoin and crypto maximalists, while others worry about a centralized entity yielding too much power in the space.
TradFi’s involuted relationship with bitcoin
Considering it appears BlackRock’s bitcoin ETF would be backed by actual bitcoin, and would therefore require the asset manager to purchase as much…
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