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Leading asset management firms, including BlackRock Asset Management, VanEck, and Fidelity, are preparing to receive regulatory approval to launch exchange-traded funds (ETFs) tied to the spot price of Bitcoin. Recent filings with the Securities and Exchange Commission (SEC) point to a collective effort to secure a coveted position in the growing crypto ETF market. Market participants are awaiting an imminent decision from the SEC, while the filings summarize key details of each firm’s arrangements with market makers to ensure efficient and liquid trading.
Strategic Filing Update: Industry Players Make Their Moves
By the close of business on Friday, key players such as Valkyrie Investments, Bitwise Investment Advisers, Invesco Ltd., WisdomTree Investments, Ark Investments, and the joint venture between Ark Investments and 21Shares, presented revised documents highlighting complex plans prepared with market makers. This strategic move positions these asset management companies at the pinnacle of potential approval, with insiders suggesting a decision could be announced as early as the following week.
Those familiar with the filing process suggest that firms meeting the year-end filing revision dates could have the opportunity to launch by January 10th. This deadline aligns with the SEC’s authority to approve or reject the Ark/21Shares ETF.
There is speculation that the SEC could notify issuers of their approvals on Tuesday or Wednesday, potentially setting a groundbreaking precedent. The doubling of Bitcoin’s price this year to approximately $42,000 has heightened expectations that the SEC will soon approve a spot Bitcoin ETF. The market eagerly awaits regulatory decisions that could unveil new investment avenues and contribute to the mainstream acceptance of cryptocurrencies.
Fee Structures Revealed: Valkyrie, Ark/21Shares, Fidelity, and Invesco
Valkyrie’s application disclosed a proposed management fee of 0.80% for the ETF, contingent on SEC approval early in the new year. Ark Investments and the joint venture with 21Shares had previously reported a similar fee structure.
In contrast, the Fidelity Wise Origin Bitcoin Fund aims to be the most cost-effective with fees set at just 0.39%. Invesco, planning a 0.59% fee, indicated it would waive this for the first $5 billion in assets for the first six months.
A Decade-Long Quest: 14 Managers Seek SEC Approval
The current race for SEC approval involves a total of 14 asset managers seeking the green light for spot Bitcoin ETFs. Over the past decade, the SEC has rejected numerous initiatives to launch such products, citing concerns over market manipulation and investor protection.
To date, approved crypto ETFs have been tied to Bitcoin and Ethereum futures contracts traded on the Chicago Mercantile Exchange.
Grayscale Investments and Hashdex Join the Fray
Notable contenders aiming to convert their existing products into spot Bitcoin ETFs, Grayscale Investments and Hashdex, submitted their updates earlier this month. The evolving landscape points to a maturing crypto market, and the SEC’s response to these applications will undoubtedly influence the trajectory of crypto investments.
As asset management giants position themselves for a potential breakthrough in Bitcoin ETF approvals, the crypto market stands at a critical juncture. Investors and market analysts, aware of the transformative impact on the accessibility and acceptance of crypto assets, await the SEC’s decision with anticipation. The coming weeks could open a new chapter in the narrative of cryptocurrencies.
