After years of denials, the U.S. Securities and Exchange Commission has approved all 11 applications for spot bitcoin ETF issuers, potentially marking a significant moment for the crypto industry. This decision could make it easier for institutional investors and consumers to invest in the largest digital asset.
Key Takeaway
The U.S. Securities and Exchange Commission has approved all 11 applications for spot bitcoin ETF issuers, potentially making it easier for institutional investors and consumers to invest in the largest digital asset.
Issuers and Listings
- BlackRock’s iShares Bitcoin Trust
- Grayscale Bitcoin Trust
- ARK 21Shares Bitcoin ETF
- Bitwise Bitcoin ETP Trust
- WisdomTree Bitcoin Fund
- Fidelity Wise Origin Bitcoin Trust
- VanEck Bitcoin Trust
- Invesco Galaxy Bitcoin ETF
- Valkyrie Bitcoin Fund
- Hashdex Bitcoin ETF
- Franklin Bitcoin ETF
Six of the ETFs will be listed on Chicago Board Options Exchange (CBOE), three on the New York Stock Exchange (NYSE), and two will trade on Nasdaq. The issuers’ fees range from as low as 0.2% to as much as 1.5%. Some issuers are offering introductory waivers with zero fees for a limited time.
Impact on Bitcoin’s Price
Following the SEC approval, Bitcoin’s price experienced a slight increase, reaching around $45,700. This represents a 161.7% increase from the year-ago date, according to CoinMarketCap data.
Spot-Based ETFs vs. Futures-Based ETFs
Spot-based ETFs allow investors to indirectly own an asset by buying shares in the fund that owns the asset, while futures-based ETFs use contracts to buy or sell an asset at a predetermined price in the future.
Industry Perspectives
Muneeb Ali, CEO of Trust Machines, views the ETF approval as a step towards bringing traditional financial products and structures to digital assets. Grayscale CEO sees the spot bitcoin ETF as the first step towards ‘normalizing’ crypto.
The only crypto-based ETFs in the U.S. approved before this decision were tied to futures contracts with bitcoin and ethereum and traded on the Chicago Mercantile Exchange. The launch of BITO, the first bitcoin-linked futures ETF in the U.S. in 2021, saw significant demand and became one of the largest and most traded crypto ETFs, according to ProShares data.
John Wu, president of Ava Labs, believes that ETFs can lend legitimacy to the space and increase adoption from investors who previously couldn’t access crypto assets. He sees the legitimization, protection, and mainstream distribution as a watershed moment for the industry.
