The U.S. Securities and Exchange Commission (SEC) has given the green light to the country’s first regulated spot Bitcoin exchange-traded funds (ETFs). This landmark decision comes a day after a false announcement from the SEC’s official Twitter account caused market turmoil.
On January 10, the SEC approved the 19b-4 applications from ARK 21Shares, Invesco Galaxy, VanEck, WisdomTree, Fidelity, and Franklin Templeton. This approval allows for the listing and trading of a spot Bitcoin ETF on their respective exchanges. However, the filing was only briefly available on the SEC website before an “Error 404” message appeared.
This historic approval marks the first time a regulated exchange-traded product in the U.S. will offer investors direct exposure to the price of Bitcoin without the need to purchase the cryptocurrency or worry about self-custody. Instead, investors will buy shares in ETFs that hold Bitcoin as its underlying asset.
The approval comes over a decade after Cameron and Tyler Winklevoss first attempted to launch the Winklevoss Bitcoin Trust in 2013. The SEC had consistently rejected all spot Bitcoin ETF requests due to concerns about potential market manipulation and fraud. However, the SEC was compelled to reconsider its stance after Grayscale won a court case in August 2023 that overturned the SEC’s denial of its application to convert its Grayscale Bitcoin Trust into a spot Bitcoin ETF.
With the approval of the spot Bitcoin ETFs, the industry is now keenly observing when the ETFs will start trading. Alex Thorn, Galaxy Research’s head of digital, estimates that spot Bitcoin ETF inflows could reach $14 billion in the first year. Meanwhile, global fund manager VanEck estimates that approximately $2.4 billion would flow into spot Bitcoin products in the first quarter of 2024.
Launching a spot Bitcoin ETF in the United States requires the SEC to approve both the S-1 (or S-3) and 19b-4 forms filed by the issuers. On January 8, ten issuers filed their final amended S-1 and S-3 filings, notably announcing the fees they intend to charge for their respective Bitcoin ETFs.
BlackRock, the world’s largest asset manager, will charge 0.2% fees until the fund reaches $5 billion in assets under management (AUM). Bitwise is close behind at 0.24%, while Ark 21Shares and VanEck are slightly higher with 0.25% fees. Ark 21 Shares will waive all fees for the first six months or until the product reaches $1 billion AUM. Grayscale currently has the highest-fee Bitcoin ETF product, charging a 1.5% fee rate on its prospective investors.
This is a developing story, and further information will be added as it becomes available.
This News Article was automatically generated by Bob the Bot (AI)
| Information | Details |
|---|---|
| Geography | North America |
| Countries | 🇺🇸 |
| Sentiment | positive |
| Relevance Score | 1 |
| People | Cameron Winklevoss, Tyler Winklevoss, Alex Thorn |
| Companies | Franklin Templeton, ARK 21Shares, BlackRock, Galaxy Research, U.S. Securities and Exchange Commission, VanEck, Invesco Galaxy, Bitwise, Fidelity, Grayscale, WisdomTree |
| Currencies | Bitcoin |
| Securities | Franklin Templeton, ARK 21Shares, Grayscale Bitcoin Trust, BlackRock, VanEck, Invesco Galaxy, Bitwise, Fidelity, WisdomTree |
