Recent actions by the US Securities and Exchange Commission (SEC) have intensified the Bitcoin community’s attention. A notable development is the SEC’s decision not to contest a ruling from the US Court of Appeals for the District of Columbia Circuit. This decision favors Grayscale’s pursuit to convert its Bitcoin Trust (GBTC) into a spot Bitcoin ETF.
Scott Johnsson, a prominent attorney from Davis Polk, has spotlighted a confidential meeting scheduled for November 2 at 2:00 p.m. ET. According to the “Sunshine Act Notice,” this meeting will discuss “initiation and settlement of administrative proceedings” and “resolving litigation claims.”
This meeting gains importance in light of the ProShares Bitcoin Strategy ETF (BITO) launch on October 19, 2021. This futures ETF not only set a landmark for Bitcoin, but also quickly surpassed $1 billion in assets after its introduction.
Interestingly, just before the BITO launch, Bloomberg reported a leak from an SEC private meeting. The leak hinted at the SEC’s willingness to approve the debut of US Bitcoin futures ETF for trading, grounded on mutual fund rules. SEC Chairman Gary Gensler believes these rules offer “considerable investor safeguards.”
Now, all eyes are on Grayscale’s spot Bitcoin ETF. Johnsson anticipates a possible leak similar to the one last year. The Bitcoin community is curious about whether the SEC will approve just Grayscale or all potential applicants.
Several prominent players, including BlackRock, Fidelity, Ark Invest, and VanEck, have submitted amendments to the SEC. Bloomberg’s experts view these revisions positively, indicating that a Bitcoin ETF could soon receive the green light. They also think the SEC strives to ensure all applicants meet a uniform criterion through these amendments.
James Seyffart from Bloomberg has also reported Valkyrie Funds making amendments related to their spot Bitcoin ETF. There is activity behind the curtain concerning their ETF application.
Johnsson added his viewpoint on this wave of revisions. He mentioned that typically, the SEC reviews a standard S-1 in 2 to 4 weeks. Hence, the Bitcoin community is on the edge of its seats, anticipating either feedback from the SEC or further revisions by industry stakeholders in the next couple of weeks.
An interesting detail observed by Johnsson is from SEC Chair Gensler’s calendar on June 15, 2023. That’s when Blackrock presented its spot ETF application. Gensler had a busy day, marked by a significant White House Interagency meeting – his first meeting since taking the SEC reins over two years ago.
The Bitcoin community remains hopeful yet cautious. Gensler might unveil unexpected alterations to the spot Bitcoin ETF applications. While some label this potential twist as a “Gensler semi-comedic rug-pull,” Bloomberg’s ETF experts, James Seyffart and Eric Balchunas, deem it potentially “wickedly unexpected.”
In response to these speculations, Johnsson remarked that predicting a logical outcome in alignment with the rumored “Gensler twist” is tricky. Nevertheless, the air of unpredictability persists.