Most reports point to the potential approval of spot Bitcoin (BTC) exchange traded funds (ETF) filings in the US by January 2024. Given the current developments, the author of this article is also quite convinced that we may be heading there. But just to keep an open mind, is there are possibility for the US Securities and Exchange (SEC) to deny them? What could be the reason for this, and most importantly, how will it impact us?
Mass Approval of Spot Bitcoin ETF
All signs lead to the likely mass approval of spot Bitcoin ETF requests around January 10, 2024. The SEC now appears to be fast-tracking everything as it just advised applicants to submit the final revisions of their filings on December 29.
The regulator also recently provided instructions on how the institutions vying for spot Bitcoin ETFs on how they should proceed with their redemption models. Everyone seems to be complying with the advice of the agency despite a little reluctance on the parts of BlackRock and Grayscale.
With the hard deadline and amendments coming straight from the horse’s mouth, it just does not make sense for the SEC to deny or further delay the proceedings.
The present state of things, coupled with the much-awaited Bitcoin halving, is fueling the hype train. Lately, these have been instrumental in BTC breaking the $44K barrier for the first time in more than a year.
As optimism runs high, it would be a punch in the gut to us who are betting on the crypto if things suddenly take a downturn.
Are We Heading Towards a Historical BTC Rug Pull?
In November, prior to the major updates on the subject, BitGo CEO Mike Belshe warned that the SEC may reject the spot Bitcoin ETF filings. He said that the SEC’s decision may be grounded on the fact that exchanges and custody are not entirely separated. However, the US watchdog hadn’t raised such issues in its meetings with the applicants, so it might not be the case.
Then again, there are experts like Nate Geraci who are keeping an eye over a potential swerve from the SEC. If the regulatory body denies the applications for some reason, it could be a catalyst for one of the “bigger rug pulls in crypto history.” He cleared out though that there’s a small window of probability for this ever happening.
Some unpopular FUD (Fear, Uncertainty, Doubt) is also being circulated as of late claiming that the SEC, in cahoots with financial powerhouses like BlackRock, may orchestrate a scheme to initially deny or continuously delay all spot Bitcoin ETFs due soon to tank BTC prices. This way, its favored institutions can further scoop more supply of the digital asset at lower prices before they blow off the roof again.
It will be like the SEC shooting itself in the foot, but there’s some semblance of logic in this narrative if one considers that the verdict for BlackRock’s filing is not due until March 2024.