The United States Securities and Exchange Commission (SEC) has postponed its decision on various proposals for spot Bitcoin exchange-traded funds (ETFs), including those from significant financial management companies like BlackRock, Invesco, Bitwise, and Valkyrie. The delays, announced in separate filings on September 28, came in anticipation of a potential U.S. government shutdown.
This situation arose as both the House and the Senate have not yet agreed on multiple funding bills necessary to finance government operations. Without passing these 12 separate full-year funding bills by October 1, a government shutdown will ensue, interrupting the activities of financial regulators and other federal organizations.
Despite the applicants’ expectation for a response from the SEC by October 16-19, the decision was deferred earlier than anticipated. This move repeats the SEC’s previous action in late August, where it delayed a group of spot Bitcoin ETF applicants as the first deadline neared.
The new set of deadlines for these applicants is now around mid-January, with the possibility of further delays. The SEC is expected to make its final decision by mid-March at the latest.
This delay doesn’t dampen the overall optimism regarding the approval of a spot Bitcoin ETF. Eric Balchunas, a Bloomberg ETF analyst, increased the probability of a spot Bitcoin ETF approval by the end of 2023 to 75%, citing the U.S. Court of Appeals Circuit’s unanimous decision in Grayscale’s court win over the SEC as a significant factor. He further raised the approval odds to 95% by the end of 2024.
While the delays are a setback for those eager for a quicker introduction of a Bitcoin ETF, the anticipation and optimism for approval remain robust within the financial community. This sentiment is underscored by the understanding that the SEC is exercising due caution in its evaluations, reflecting the regulatory body’s commitment to ensuring the stability and security of the evolving cryptocurrency market within the established financial framework.
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