Investors in the US have been in the spotlight of the SEC for a while. bitcoin Waiting for his ETF to be approved. The SEC gave a positive signal by approving the first leveraged BTC futures ETF in June of this year. The confirmation came as a surprise to many. However, it did manage to rekindle hope, as community members saw it as “an early sign of the SEC’s easing.” Previously, the commission had approved a number of futures ETFs, including ProShares’ BITO and BITI.
Companies including BlackRock, Fidelity, Invesco and VanEck once again submitted their requests for a spot Bitcoin ETF in June. Applications are currently awaiting approval by the SEC. Officials reported that the applications to Nasdaq and CBOE Global Markets were not clear and comprehensive enough. It is noteworthy that the exchanges in question made the applications on behalf of investment managers.
Bernstein, on the other hand, seems to take a different view. In a recent research report, he explained that the odds of SEC approval for a spot ETF remain quite high. Bernstein noted that the agency is comfortable with regulated exchanges like the CME and therefore has already approved futures and leveraged Bitcoin ETFs.
However, he is skeptical when it comes to a spot BTC ETF because spot exchanges like Coinbase are not under its own regulation, so spot prices are unreliable and open to manipulation.” Indeed, there is a gap. Gautam Chhugani analysts summed up this situation.
The court did not seem convinced that the futures price was not derived from the spot price, and so allowing a futures-based ETF but not allowing spot trading seems like a hard pill to swallow for the courts.
In fact, the report also highlighted how the industry is proposing an oversight agreement between the spot exchange operator and regulated exchanges like the Nasdaq. Other expensive, illiquid and inefficient OTC products like Grayscale’s GBTC are currently trying to replace the spot BTC ETF. Despite the recovery on the YTD front, GBTC continued to trade at a discount of 31% compared to its NAV. According to Bernstein’s analysts:
Rather than dealing with a Grayscale OTC product that fills the SEC institutional vacuum, it would rather bring in a regulated Bitcoin ETF managed by more mainstream Wall Street participants and overseen by existing regulated exchanges.
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