The U.S. Securities and Exchange Commission (SEC) has received an updated proposal from Fidelity for a spot bitcoin exchange-traded fund (ETF). The asset management continues to work with other applicants to overcome the regulatory issues that have prevented the investment product from being approved.
Updated Spot Bitcoin ETF Prospectus Submitted by Fidelity to SEC
Financial behemoth Fidelity has sent the American securities regulator a new version of its Wise Origin Bitcoin Trust. In an effort to comply with SEC guidelines, the new spot bitcoin ETF prospectus tries to improve the likelihood of acceptance.
Fidelity's latest filing places it in company with other prospective issuers who have made an effort to allay the regulator's worries in various respects. Earlier in October, Invesco and Ark Invest resubmitted their applications.
James Seyffart of Bloomberg sees these actions as promising developments. In a post on X, formerly Twitter, the ETF expert offered his analysis of the most recent development:
More evidence that potential spot Bitcoin ETF issuers are in contact with the SEC about any modifications or revisions that must be made before the SEC will consider approving. IMO, this is a good indicator.
Seyffart shared a tweet from finance attorney Scott Johnsson that outlined a number of recurring elements in the modified petitions. These cover specifics like custody agreements, how hard forks are handled, and how energy-intensive cryptocurrency mining is.
Recurring themes I'm seeing in the amendments so far:
- Specifying custodial arrangements in detail
- Mechanics around hard forks
- Valuation/pricing sources and adherence to GAAP
- Risk disclosure around regulatory uncertainty
- Mining is very energy intensive... https://t.co/sFJqwznuzr
The U.S. Securities and Exchange Commission approved ETFs that contain bitcoin futures in 2021, but the organization has been hesitant to approve a spot bitcoin ETF, previously citing fraud and market manipulation threats as well as issues with custody and investor security.
The SEC agreed to consider a number of petitions earlier this year, but it has since postponed making conclusions regarding those submitted by Fidelity, financial behemoth Blackrock, Vaneck, Wisdomtree, Valkyrie, Bitwise, and Invesco, among others.
Many in the industry anticipate the Commission's decision on one or more ETFs in the first quarter of 2019, especially in light of recent events like the SEC's missed deadline to file an appeal of a court decision favoring Grayscale's spot bitcoin ETF. The fact that bitcoin (BTC) rose this week on false reports that Blackrock's bitcoin ETF had been approved serves as evidence of the growing anticipation.
Do you believe the new applications for spot bitcoin ETFs will be accepted by the SEC? Post your opinions about it in the comments area below.