The journey towards the approval of a Bitcoin ETF has been a long and arduous one. The Winklevoss twins filed the first Bitcoin ETF application in 2013, but US regulators have yet to give their stamp of approval. However, the tides seem to be shifting as some of the biggest names in traditional finance have entered the race.
On June 15, BlackRock, the world’s largest fund manager, filed for a spot Bitcoin investment trust fund through iShares, the company responsible for managing its family of ETFs. This move was quickly followed by several other companies, including Fidelity, Invesco, WisdomTree, Valkyrie Investments, and VanEck, who also filed for spot Bitcoin ETFs.
These companies have taken into account the concerns raised by the Securities and Exchange Commission (SEC), as seen in their recent lawsuits against Binance and Coinbase. BlackRock’s application, for instance, includes a surveillance-sharing clause, a first for spot Bitcoin ETF applications. In response to the SEC’s lawsuits against Binance and Coinbase, BlackRock promptly added this clause to its application.
Under the surveillance-sharing agreement, BlackRock will share trading, clearing, and customer identity details with regulators to prevent fraud and manipulation. However, reports suggest that the SEC found BlackRock’s initial application lacking in specific details. As a result, the asset manager refiled and stated that Coinbase would be its surveillance partner.
Similarly, Ark Invest, which filed its spot Bitcoin ETF application in April alongside investment company 21Shares, amended its filing on June 28 to include a surveillance-sharing clause. Ark Invest is also expected to partner with Coinbase for surveillance sharing.
The introduction of major players in the spot Bitcoin ETF race has sparked a surge of interest in the crypto market, with Bitcoin maintaining a price of around $30K. Now, the question arises: which application will the SEC approve first?
The Timeline and Implications of Approval
Cathie Wood, the CEO of ARK Investment, believes her company is at the forefront of approval if the SEC gives the green light. She estimates that the SEC could take until mid-January to make a decision on Ark Invest’s application, and until March for BlackRock’s spot Bitcoin ETF application.
However, clarity may come sooner when the court delivers its verdict in August on Grayscale’s lawsuit against the SEC’s rejection of its spot Bitcoin ETF application. Grayscale’s proposal aims to have the ETF fully backed by Bitcoin held in cold storage. Wood argues that approving a Bitcoin Futures ETF, which involves swaps, while rejecting a fully-backed Spot ETF would be contradictory.
Taking all these factors into consideration, it appears that BlackRock does not have an edge over Ark Invest, according to the CEO of Ark Invest. The race for Bitcoin ETF approval is heating up, and the outcome remains uncertain. Will the SEC finally give the green light to a Bitcoin ETF, and if so, which company will be the first to receive approval? Only time will tell.