As of now, the SEC has granted approval for trading only seven Bitcoin ETFs in the United States. Nevertheless, over 20 additional filings for Bitcoin ETFs are pending approval from the SEC.
WHAT ARE THE BITCOIN ETFs?
Bitcoin ETFs represent exchange-traded funds designed to mirror the value of Bitcoin and are traded on conventional market exchanges instead of cryptocurrency platforms. These investment vehicles offer a convenient means for investors to participate in Bitcoin without navigating the complexities of cryptocurrency exchanges, all while providing exposure to potential price fluctuations.
An exchange-traded fund (ETF) is an investment fund designed to mirror the performance of an underlying asset or index. In contemporary finance, ETFs cover a broad spectrum of assets and industries, spanning from commodities to currencies.
A Bitcoin ETF would operate on a similar principle, where the value of a single ETF share would correspond to the fluctuations in the price of Bitcoin. If the value of Bitcoin rises, the ETF value follows suit, and conversely, if Bitcoin experiences a decrease in value. The distinctive feature is that, unlike trading on a cryptocurrency exchange, the Bitcoin ETF would be traded on a conventional market exchange such as the NYSE or TSX.
WHEN BITCOIN ETFs ARE GOING TO BE AVAILABLE?
Currently, thirteen entities, including Grayscale Investments, BlackRock, Invesco, and ARK Investments, are awaiting the SEC's decisions on their spot ETF applications. Historically, the U.S. Securities and Exchange Commission (SEC) has rejected numerous proposals for Bitcoin ETFs, citing concerns about the lack of regulation in the market.
However, a notable shift in the SEC's stance emerged following a significant court ruling in August, which declared the SEC's rejection of Grayscale's spot ETF application as incorrect.
Industry executives and SEC public memos suggest that, since the court ruling, the SEC has been actively engaging with issuers on substantive details, some of which are typically addressed towards the conclusion of the ETF application process.
As per Reuters, meaningful advancements have been achieved in the talks between the US Securities and Exchange Commission (SEC) and asset managers regarding the possible authorization of Bitcoin exchange-traded funds (ETFs).
“Discussions between the US securities regulator and asset managers hoping to list Bitcoin exchange-traded funds (ETFs) have advanced to key technical details, in a sign the agency may soon approve the products,” Reuters reports.
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