SEC Signals First Wave Of Spot Bitcoin ETF Approvals In January

The rumored meeting between the U.S. Securities and Exchange Commission (SEC) and several hopeful issuers has yielded a couple of confirmations -- the deadline for changes on spot Bitcoin exchange-traded fund (ETF) filings has been set for Dec. 29, and the initial wave of possible approvals could happen early January 2024.

The major Wall Street regulator has set Dec. 29 as the deadline for businesses hoping to offer spot Bitcoin ETF, Reuters reported, citing "public memos and two people familiar with the discussions."

The said meeting was attended by representatives of seven hopeful spot Bitcoin ETF issuers, including BlackRock, Grayscale Investments, ARK Investments and 21 Shares, with two firms reportedly asked to submit final changes by the end of next week.

Moreover, SEC officials who attended the meeting informed issuers that those who were not able to meet the deadline set by the commission would not be included in the "first wave" of approvals of spot Bitcoin ETF scheduled in the early part of January.

Also, during last Thursday's meeting, SEC officials told attendees that it could announce the approval of the first wave of spot Bitcoin ETF applicants in the first few business days of 2024, by directly informing issuers of the date their applications would be "effective."

Bloomberg Intelligence senior ETF analyst Eric Balchunas, last week, tweeted that lawyers of BlackRock, the New York-based mega asset management firm and one of the hopeful spot Bitcoin ETF issuers, were "living at the SEC," probably because of the number of times the firm's representatives had met with the officials of the commission.

"BlackRock lawyers straight living at the SEC lately. But not sure it matters anymore. Word is SEC is hard line on what they need re no wiggle room language around cash creations and an AP agreement. When we see S-1s w those updates can prob assume that issuer is home free," Balchunas' tweet read.

Despite the reports surrounding the decision of the SEC on spot Bitcoin ETF applications, the commission has not yet issued any statements related to it, and has maintained its stance of not commenting on individual filings.

It is worth noting that several issuers have amended their proposal over the past week.

Blackrock and ARK changed their S-1 registration from in-kind to cash creation and redemption model, which was believed to be the preferred mechanism the SEC wanted on the crypto investment vehicle over concern of potential market manipulation and the former model being used for money laundering.