BREAKING: SEC Puts Spot Bitcoin ETF Proposals on Hold, Delaying Valkyrie, WisdomTree, and Invesco Applications
The saga surrounding cryptocurrency regulation in the United States continues. This week, the Securities and Exchange Commission (SEC) postponed its ruling on spot Bitcoin exchange-traded fund (ETF) proposals from Valkyrie, WisdomTree, and Invesco. This latest SEC delay applies specifically to spot Bitcoin ETFs, which would allow direct ownership of the cryptocurrency itself.
While disappointing to many in the crypto industry, the delay is not entirely surprising given the SEC’s historically cautious approach to crypto-based financial products amid concerns around volatility and investor protection. The SEC did not provide a timeline for when it may approve a spot Bitcoin ETF, leaving the fate of these proposals in limbo for now.
JUST IN: 🇺🇸 SEC delays Valkyrie, WisdomTree, and Invesco Spot #Bitcoin ETF applications.
— Watcher.Guru (@WatcherGuru) August 31, 2023
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The Backdrop: A Race for Approval
The SEC has been inundated with applications for spot Bitcoin ETFs, with WisdomTree, Invesco, and Valkyrie leading the charge. These firms aim to provide investors with exposure to Bitcoin’s price fluctuations while mitigating the operational costs and obligations tied to running an ETF. Specifically, WisdomTree’s trust plans to peg the daily value of its shares to the CF Bitcoin US Settlement Price, a metric that aggregates trading data from key Bitcoin spot exchanges.
A History of Rejections
It’s worth noting that both WisdomTree and Invesco have faced setbacks in their quest for SEC approval. WisdomTree’s initial application was rejected in December 2021, while Invesco faced a similar fate in October 2022. Despite these hurdles, the SEC has accepted spot Bitcoin ETF applications from six firms, including WisdomTree, VanEck, Invesco, and ARK 21Shares.
The Implications: A Delayed Reality
The SEC’s decision to postpone rulings on these applications adds another layer of uncertainty to the already complex landscape of cryptocurrency regulation. However, the acceptance of applications from six firms suggests that the SEC is not entirely closed off to the idea of a spot Bitcoin ETF. The eventual approval of these applications could serve as a significant milestone, bringing the concept of a spot Bitcoin ETF one step closer to becoming a reality.
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