• Sun. Feb 25th, 2024

SEC Shifts Deadline To Final Decision On Grayscale ETF Application

Maria Bartiromo

ByMaria Bartiromo

Dec 8, 2023

The deadline for the Securities and Exchange Commission’s (SEC) decision on Grayscale Investments’ application for a Bitcoin Spot ETF has been extended by 45 days. Tension in the market is rising as the decision, first expected on December 5, is now scheduled to be revealed within the extended period.

In June 2022, Grayscale Investments filed a request to start a Bitcoin Spot ETF. The SEC’s decision timeline extension adds to the already high anticipation among issuers and investors waiting impatiently for the commission’s ruling regarding spot ETF approval.

Grace Abidemi from Daily Coin say that should the SEC approve the request; it will be a huge step forward for the cryptocurrency space, giving institutional and retail investors access to Bitcoin through a regulated and accepted investment vehicle.

According to an official statement by SEC, it found it necessary to further extend the timeframe it is expected to take action on the many applications it has received on the change of rules. This, according to it’s statement, will enable it have enough time to come up with the right decision.

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Commission Says Discussion Centered On  Investment Regulatory Environment

The report has it that discussions are centred on the regulatory environment surrounding bitcoin investments, with regulatory organizations attempting to find a middle ground between protecting investors and encouraging innovation.

Abidemi added that issuing a Bitcoin Spot ETF may indicate that the cryptocurrency market is maturing and drawing on a broader group of investors who want exposure to digital assets in a regulated environment.

When the decision is made public, it is anticipated to affect market sentiment significantly. It is expected to significantly impact how institutions participate in the future and how regulations are shaped for cryptocurrency investments. 

The application by Grayscale this October is the 5th on the list of other applicants, with major industry players like VanEck, HashDex, Fidelity, 21Shares, and others making the list. Some of these applicants applied as joint applicants. The affected include Galaxy and Invesco, Ark Invest and 21Shares.

Arca Makes Recommendations For A Change In SEC’s Decision 

The manager at GrayScale Investments had filed a request with the United States SEC sometime in June 2022 to introduce its BTC Spot ETF. The authorities previously turned down the proposal, triggering Grayscale’s decision through legal means, hence, the court filing. 

The case favoured Grayscale, forcing SEC to reintroduce the application. SEC I had added an extra 45-day deadline to come up with its decision on Grayscale’s application. News has it that the deadline extension gave SEC enough time to review the company’s application to swap Ethereum Trust (GETH) to spot Ethereum ETF. 

However, Arca had recommended initially on October 10, 2023, that there should be a change in SEC’s rules. SEC says it has only 45 days from the original publication date of the company’s proposal to decide the Federal Register. SEC has also extended the formal introduction of Spot ETF to January 25, 2024, to give it more time to ascertain the implications of such a move.

It is said that the proposed Grayscale Ethereum Trust will be worth $5 billion and the most significant investment by an institution on Ethereum, allowing clients to convert their assets to a spot ETF. Meanwhile, SEC also reverse the right to approve or reject the proposal for rule change should it find it unnecessary.

Maria Bartiromo

Maria Bartiromo

Maria Bartiromo is a renowned news writer and journalist, celebrated for her insightful reporting and authoritative voice. With a career spanning years, she has established herself as a trusted source of accurate and comprehensive news analysis, keeping readers informed on vital global developments.

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