Spot Bitcoin ETF approval ‘still happening’ by Jan. 10, analysts say

Bloomberg ETF analysts still expect the SEC to approve a spot Bitcoin ETF in January 2024 despite multiple amendments which the regulator may or may not like.
Bloomberg ETF analysts still expect the SEC to approve a spot Bitcoin ETF in January 2024 despite multiple amendments which the regulator may or may not like.

As applicants for spot Bitcoin (BTC) exchange-traded funds (ETF) rush to incorporate new cash-only requirements into their proposals in the last month of 2023, some analysts still expect ETF approvals in the United States by early 2024.

Bloomberg ETF analysts James Seyffart and Eric Balchunas anticipate that the U.S. Securities and Exchange Commission (SEC) will approve a spot Bitcoin ETF in January 2024 despite multiple last-minute amendments that applicants are scrambling to add to their proposals.

Seyffart took to X (formerly Twitter) on Dec. 21 to share his observations about BlackRock’s latest spot Bitcoin ETF update from Dec. 18, which accepted the SEC’s cash redemption system instead of in-kind redemptions, or those implying non-monetary payments like BTC.

The analyst noticed that BlackRock’s latest iShares Bitcoin Trust ETF S-1 registration statement replaced the term “prime broker and the trade credit lender” with the “prime execution agent,” noting that the SEC “might not be comfortable” with the change.

“Will be interesting to see who updates their documents after this,” Seyffart wrote, adding that the SEC might not accept a condition where a third party would buy and sell Bitcoin on behalf of the ETF in the Bitcoin cash model.

BlackRock’s iShares Bitcoin Trust ETF S-1 registration statement from Dec. 18. Source: SEC

The analyst noted that multiple applicants like ARK, Bitwise and Valkyrie have already set up for a cash-only model, while some — including Grayscale and WisdomTree — still have in-kind or cash in their filings.

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“All this is to say — we still think this is happening by Jan. 10,” Seyffart stated. He added that “some issuers may be left behind,” referring to some filers failing to accept the SEC’s cash-only model.

Cash-only and in-kind models by spot BTC ETF filers as of Dec. 21, 2023. Source

Seyffart’s colleague Balchunas agreed that the ongoing meetings and calls between the SEC multiple spot BTC ETF filers are an “interesting and good sign for January.”

“We are hearing it wasn't one giant conf call b/t SEC and every issuer but rather many calls to exchanges/issuers to reiterate that its Cash Creates or You Will Wait,” Balchunas wrote.

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