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The world’s largest BTC fund, Grayscale is baking on SEC approval for a spot Bitcoin ETF instead of the recently launched futures ETFs.
Grayscale Investments is eyeing a Bitcoin (BTC) exchange-traded fund launch as early as July next year, according to a company executive. On Wednesday, David LaValle, global head of ETFs at Grayscale Investments, said that he sees potential for the SEC to approve Grayscale’s application for a spot Bitcoin ETF by July 2022. Furthermore, LaValle believes the timing for submitting the application this week – which affords the US regulators a nine-month timeline – was ideal. In addition, the Grayscale executive also suggested that the SEC may be more willing to consider filings of other product variations – following the successful launch of some BTC futures products. As Lavalle put it:
“Now that the Bitcoin futures products were somewhat off the plate of the SEC, they would be open to look at the filings of spot-based products.”
Grayscale submitted its filing on October 19th. This was the same day that ProShares Bitcoin Strategy ETF made its debut trading as the first US Bitcoin futures ETF. Besides, the SEC typically takes up to 240 days to analyze an ETF filing application before making a final decision. In October, four ETFs secured regulatory approval, but are all based on Bitcoin futures rather than spot. Grayscale shapes up to be one of several hopefuls looking to change this and diversify the playing field a little bit more. Furthermore, LaValle believes that “the futures market and spot market are intrinsically related.” Plus, “The acceptance of a bitcoin futures product means the SEC would respond to our filing of spot products.”
As at Thursday, GBTC had $38.8 billion in assets under management. This brings the total value across all Grayscale funds to $53.1 billion.
Gemini’s David Abner Fancies Grayscale Chances for Spot Bitcoin ETF
David Abner, global head of business development at Gemini also weighed in. Speaking on the same panel as LaValle. Abner said predicting the SEC’s approval of a spot Bitcoin ETF is difficult. However, he suggested that it may happen sooner rather than later – as early as the end of this year. Abner’s reason for this projection is because the SEC is already taking steps toward that realization. In his own words:
“What we can be sure of is that they’ve taken the steps. We’re moving forward…There’s a path coming here.”
Another potential difficulty with approval of Bitcoin ETFs is emergence of ETFs for other tokens. When asked if Ether futures ETFs may be next in line, Abner said that its a challenge for the SEC. As he put it:
“There are some concerns that the approval of a Bitcoin futures ETF leads to the request for Ethereum futures ETFs, and then in a short amount of time, you’d have advisers looking for a SHIB ETF as well.”
However, Abner emphasized that the Commission is working on a framework for digital currency ETF approval. This is so that any current or subsequent approvals do not come across as arbitrary or an afterthought.