In a highly anticipated move, the United States Securities and Exchange Commission (SEC) has issued a series of critical updates regarding the approval process for spot Bitcoin exchange-traded funds (ETFs) slated for January 2024.
The SEC has now revealed that the first wave of potential spot Bitcoin ETF issuers will consist only of those firms that successfully submit their final S-1 amendment forms by the impending deadline. The cutoff date for these crucial submissions is the 29th of December, 2023. Any applicant failing to meet this deadline will not be considered for the initial wave.
Elimination of ‘In-Kind’ Creation Model
A significant development involves the SEC’s firm stance on the elimination of the ‘in-kind’ creation model. The regulator has been actively engaging with all applicants, urging them to remove any ‘in-kind’ directives from their spot Bitcoin ETF prospectuses. Instead, companies are required to adhere to the “Cash Creates” redemption model.
As of now, two prominent firms, BlackRock and Bitwise, took the lead by submitting their S-1 amendment forms on the 4th of December, 2023. On December 8th, VanEck joined the fray by submitting its fifth S-1 amendment form. Other applicants, including Grayscale, had already submitted their amendments on or before November of this year.
Prime Execution Agent Model and Regulatory Adjustments
The financial industry is keeping a close eye on the SEC’s stance regarding the Prime Execution Agent model, as this will likely require adjustments to filings from companies like BlackRock. This development signifies a notable shift towards a more proactive approach to cryptocurrencies, marking a departure from the SEC’s traditionally conservative stance.
The crypto market is abuzz with excitement and anticipation as we await further updates and potential approval of spot Bitcoin ETFs in the coming weeks. Stay tuned for more breaking news on this groundbreaking development in the world of digital assets.
