SEC likely to approve Bitcoin ETF in 1-2 years
SEC likely to approve bitcoin ETF in 1-2 years, analyst says According to an analyst at CFRA Research, VanEck, Fidelity Investments, and Valkyrie Digital Assets may not see its exchange-traded funds, or ETFs, approved by U.S. regulators for up to two years. In an interview on CNBC’s ETF Edge Monday, Todd Rosenbluth, head of ETF and mutual fund research at CFRA, told host Bob Pisani that he believes the U.S. Securities and Exchange Commission, or SEC, will extend the time frame for reviewing the bitcoin ETF first unveiled by investment management firm VanEck in January. The SEC officially acknowledged receipt of the bitcoin ETF application on March 15 and gave the regulator until April 29 to make a decision or extend the deadline.
The final decision for VanEck is still pending, as is the fate of the bitcoin ETF application from fellow investment manager Fidelity. However, it seemed more likely that SEC would approve bitcoin ETFs earlier this month when it announced in a public filing that the regulator plans to vote on bitcoin ETFs at its August meeting, which would run through Sept. 5. This timeframe would most likely allow the SEC to look at bitcoin ETF applications and then approve some of them before the summer break begins. CoinDesk previously reported that the SEC’s March 15 announcement on bitcoin ETFs marked the end of an initial public review period for companies wanting to launch the funds.
The reason Rosenbluth doesn’t expect the SEC bitcoin ETF approval to be granted in the next two years is that the agency is unlikely to approve a bitcoin ETF in such a short period of time. He explained, “I think [approval] will take longer than two years. The SEC has to work through all the public comments, rulemaking, and other steps associated with a bitcoin ETF approval.
“The bitcoin ETF will probably be approved, and it will be a significant event in terms of bringing bitcoin ETFs to the market.” said Rosenbluth. “So what we’re saying is we don’t expect it to be approved, and I think it will probably be approved in the next two or three years, at the earliest.” Rosenbluth noted that a SEC decision approving a bitcoin ETF would likely trigger a slew of other bitcoin ETFs to be approved, with possibly as many as two dozen ETFs ready to launch. The ETFs would be structured similarly to existing equity-based ETFs, using the bitcoin price to determine exposure and “diversification,” he explained. “A degree of caution is warranted,” Rosenbluth said.
The announcement, if passed, would open the door for millions of retail investors to gain exposure to the volatile cryptocurrency market. While Bitcoin remains niche, adoption of the cryptocurrency is growing rapidly around the world. The SEC decision will likely open the door for other U.S.-based ETF providers to pursue the Bitcoin exchange-traded fund or ETF. VanEck’s potential bitcoin ETF would mark the first such listing approved by the SEC. Other fund providers such as Fidelity and Vanguard are believed to have submitted applications for bitcoin ETFs. The SEC has yet to approve a bitcoin ETF as the regulator continues to approve ETF applications in a staggered manner.
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