Bitcoin spot ETF soon to receive U.S. approval after update

In a major development for the cryptocurrency market, investment managers and stock exchanges are on the verge of receiving U.S. approval for a Bitcoin spot exchange-traded fund (ETF) after a last-minute update to the application.

Representatives of the companies participated in discussions with U.S. Securities and Exchange Commission (SEC) officials on Friday to finalize the wording of their S-1 prospectus documents, which is critical for any ETF seeking regulatory approval.

Five company executives, who requested anonymity because of the sensitivity of the discussions, said they expect the SEC to give final approval to their S-1 filings by the end of the year, next Tuesday or Wednesday.

The SEC proposed minor changes to filings, primarily related to disclosure of the ETF’s fee structure and market maker identity. The amendments are expected to be tabled on Monday morning and could be announced the same day.

An SEC spokesman maintained the agency’s policy of not commenting on individual filings. Meanwhile, the exchange has been coordinating with regulators to complete the necessary 19b-4 filings, which outline the rule changes needed to launch a Bitcoin spot ETF. On Friday, the exchange made changes to 11 of the documents.

The application process is being closely watched by industry insiders, who note that issuers that have revised their year-end deadlines may receive launch approval as early as January 10. This is the deadline for the SEC to make a decision and the Ark/21Shares ETF is currently at the forefront.

The U.S. Securities and Exchange Commission has previously rejected a spot application for a Bitcoin ETF, citing concerns about potential market manipulation. However, last year, 14 companies, including major players such as BlackRock (NYSE: BLK ), Fidelity and WisdomTree, submitted applications for such ETFs and are currently awaiting a decision from the SEC.

In an unusual request, the SEC asked issuers scheduled to launch next week to prepare formal requests to regulators to speed up the effective dates of the ETFs, while others engaged in informal discussions more typical of the time.

Reuters contributed to this article.

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