The recent dismissal of BlackRock’s spot Bitcoin ETF by the U.S. Securities and Exchange Commission (SEC) should not be seen as a roadblock to its overall success, according to statements made by Nasdaq executive Giang Bui. BlackRock filed an application for the ETF on June 15, with Nasdaq responsible for filing the necessary rule changes to list the product. However, the SEC declared the filing inadequate, leading to its early rejection. It is important to note that this rejection is primarily due to regulatory procedural issues rather than the viability of the product itself.
Interestingly, early rejections may actually be viewed in a positive light by the applicants. Giang Bui explains that once an exchange files the necessary forms with the SEC, there is a seven-day window for potential rejection if it fails to comply with SEC rules. This initial rejection is procedural in nature and does not indicate the overall potential of the product. In fact, Nasdaq and other applicants have responded to the rejections by filing updates for their ETF applications, with Coinbase explicitly listed as a surveillance-sharing agreement partner. This move demonstrates the commitment of the applicants to make their filings as strong as possible.
BlackRock’s proposed spot Bitcoin ETF is not the only one of its kind in the market. Nasdaq is simultaneously handling a similar proposal from Valkyrie Investments, while Cboe is handling proposals from several other asset management firms, including Ark Invest, VanEck, WisdomTree, Invesco, and Fidelity. NYSE Arca is also in charge of handling an ETF proposal from Bitwise. Interestingly, many of these proposals describe a surveillance-sharing agreement with Coinbase. This highlights the importance of Coinbase as a key player in the cryptocurrency industry.
In addition to these proposals, Grayscale aims to convert its existing GBTC fund into a spot Bitcoin ETF. Bui acknowledged Grayscale’s proposal and the recent legal victory it achieved, stating that Nasdaq is currently analyzing the implications for its own filings. It is evident that multiple entities are exploring different approaches to bring a Bitcoin ETF to market, further demonstrating the growing demand for such a product.
In late August, the SEC postponed its decision on the majority of the spot Bitcoin ETF filings. Investors and industry stakeholders eagerly await the SEC’s decision, which is expected to be made in October. Regardless of the outcome, it is important to remember that early setbacks should not be seen as definitive indicators of a product’s success. The resilience and adaptability shown by the applicants, along with the increasing interest in Bitcoin ETFs, suggest that the path to approval may be closer than ever.
The recent dismissal of BlackRock’s spot Bitcoin ETF by the SEC should not deter industry players and investors. While the rejection presents a regulatory obstacle, it does not undermine the potential success of the product. The response by applicants, such as Nasdaq listing Coinbase as a partner, demonstrates their commitment to meeting regulatory requirements. With multiple proposals in the market and ongoing efforts to bring a Bitcoin ETF to investors, the future of these products remains promising. The anticipated decision by the SEC in October will undoubtedly shape the landscape of cryptocurrency investments.