BREAKING: SEC Approves Spot Bitcoin ETF

The United States Securities and Exchange Commission (SEC) has given its official approval for the first regulated spot Bitcoin exchange-traded funds (ETFs) in the United States.

This decision comes just one day after a false announcement from the SEC's official Twitter account created confusion in the markets.

On January 10, the SEC granted approval for the 19b-4 applications submitted by several entities, including ARK 21Shares, Invesco Galaxy, VanEck, WisdomTree, Fidelity, Valkyrie, BlackRock, Grayscale, Bitwise, Hashdex, and Franklin Templeton.

These approvals involve rule changes that allow the listing and trading of spot Bitcoin ETFs on the respective exchanges.

The filing was briefly available for download on the SEC website before displaying an 'Error 404' message. It later became accessible through an alternative link.

This historic approval opens the door for the first regulated exchange-traded product in the U.S. to provide investors with direct exposure to Bitcoin's price without requiring them to purchase and custody Bitcoin themselves.

Investors will be able to buy shares in ETFs that hold Bitcoin as their underlying asset.

ETF analyst James Seyffart commented on X (formerly Twitter) that the SEC may not have intended to release the approval document at that particular moment but is likely to repost it later.

This approval comes after more than a decade since Cameron and Tyler Winklevoss initially applied to launch the Winklevoss Bitcoin Trust in 2013. The SEC had consistently rejected all previous spot Bitcoin ETF requests, expressing concerns about potential market manipulation and fraud.

The SEC revisited its stance after Grayscale won a court case in August 2023 that overturned the SEC's denial of its application to convert its Grayscale Bitcoin Trust into a spot Bitcoin ETF.

Now that spot Bitcoin ETFs have been approved, the industry is eagerly awaiting the commencement of trading for these ETFs.

Alex Thorn, the Head of Digital at Galaxy Research, estimates that spot Bitcoin ETF inflows could reach $14 billion in the first year.

Global fund manager VanEck anticipates that approximately $2.4 billion will flow into spot Bitcoin products in the first quarter of 2024.

Launching a spot Bitcoin ETF in the United States requires approval from the SEC for both the S-1 (or S-3) and 19b-4 forms filed by the issuers.

On January 8, ten issuers submitted their final amended S-1 and S-3 filings, revealing the fees they intend to charge for their respective Bitcoin ETFs.

Notably, BlackRock, the world's largest asset manager, plans to charge a 0.2% fee until the fund reaches $5 billion in assets under management (AUM). Bitwise follows closely with a 0.24% fee, while Ark 21Shares and VanEck have slightly higher fees at 0.25%.

Ark 21Shares has announced that it will waive all fees for the first six months or until the product reaches $1 billion in AUM.

In contrast, Grayscale currently has the highest fee rate among Bitcoin ETF products, charging 1.5% for its prospective investors.

Sources:

https://cointelegraph.com/news/sec-spot-bitcoin-etf-approvals

https://www.sec.gov/files/rules/sro/nysearca/2024/34-99306.pdf

https://twitter.com/JSeyff/status/1745191756365176978

https://unchainedcrypto.substack.com/p/transcript-ep562-how-much-money-will

https://www.sec.gov/Archives/edgar/data/1763415/000183988224000524/bitcoin-s1a_010824.htm

https://www.sec.gov/Archives/edgar/data/1869699/000119312524003823/d549524ds1a.htm

https://www.sec.gov/Archives/edgar/data/1838028/000093041324000044/c106800_s1a.htm

https://www.sec.gov/Archives/edgar/data/1588489/000119312524003901/d144925ds3a.htm