Deadline Looms for Bitcoin ETF Applicants in the U.S.

SEC Sets Final Amendment Deadline

The United States Securities and Exchange Commission (SEC) has issued a critical deadline for aspiring Bitcoin exchange-traded fund (ETF) applicants. They have until December 29 to finalize their S-1 amendments, a crucial step in the application process. This information comes from a recent Reuters report, which references public memos and sources familiar with the matter.

Key Meeting with SEC Officials

On December 21, SEC officials convened with representatives from several firms. These firms are aiming to launch spot Bitcoin ETFs in early 2024. Key players such as BlackRock, Grayscale Investments, ARK Invest, and 21 Shares were present. Additionally, representatives from Nasdaq and the Chicago Board Options Exchange attended, alongside various lawyers and issuers.

A Firm Deadline for First Wave Approvals

The SEC communicated a clear message during these meetings. They stated that any issuer failing to meet the December 29 deadline would miss out on being part of the initial wave of potential spot Bitcoin ETF approvals expected in early January.

Reporting on the Deadlin

Eleanor Terrett, a Fox Business journalist, was among the first to report this deadline. Terrett highlighted the significance of the December 29 date for final amendments to all S-1 filings. She noted that filings referencing in-kind creation would face rejection.

Rush to Update Filings

Many spot Bitcoin ETF filers have been updating their S-1 filings. They are switching from in-kind redemptions, which involve non-monetary payments like Bitcoin, to a cash redemption model.

The SEC's Specific Requirements

The SEC has additional requirements for Bitcoin ETF filers. They must name the authorized participants (AP) in their filings. Eric Balchunas, a Bloomberg ETF analyst, stated that securing an AP agreement is a significant final hurdle. As of December 22, no filer had completed this step. However, seven firms had already switched to a strictly cash redemption model.

Analysts Remain Hopeful

Despite these last-minute updates, Bloomberg analysts maintain a positive outlook. They believe the SEC will approve the first spot Bitcoin ETFs by January 10.

While the SEC's strict deadline and requirements mark a significant step for the cryptocurrency market, the stringent regulations reflect the ongoing caution in the financial sector towards digital currencies.