“Once crypto exchanges are compliant, the SEC’s primary reason for denying spot Bitcoin ETFs would no longer be valid, likely clearing the way for approval,” said the analysts.
Bloomberg exchange-traded fund analysts Eric Balchunas and James Seyffart believe that a potential regulation change with the US Securities and Exchange Commission might be the spark for the regulatory body to approve a spot Bitcoin ETF in mid-2023.
Balchunas stated in a Thursday tweet that crypto platforms might be regulated by the SEC if the commission approves an adjustment to the definition of “exchange” suggested in January. The rule change would extend the Exchange Act to include platforms “that make any type of securities available for trading” — presumably including cryptocurrencies, making them more appealing as investment vehicles for the regulator.
“Once crypto exchanges become compliant, the SEC’s primary justification for refusing spot Bitcoin ETFs becomes invalid, paving the road for approval,” the analysts wrote.
Balchunas and Seyffart stated that the SEC might authorize spot crypto ETFs, including those with exposure to Bitcoin, under this updated definition of “exchanges,” which could be finalized between November 2022 and May 2023. (BTC). Despite permitting several investment vehicles tied to Bitcoin futures in 2021, the regulatory body has thus far rejected all rule amendments allowing for the launching of spot BTC ETFs on exchanges.
New note out on why we think spot bitcoin ETFs will get approved in early Summer 2023. The SEC is proposing to expand the definition of "exchange" which would bring crypto platforms under SEC reg. After that (which could take a year) look for ETFs to get green light via @JSeyff pic.twitter.com/TtFgFXrJ8h
— Eric Balchunas (@EricBalchunas) March 24, 2022
Numerous lawmakers and industry executives in the United States have reacted angrily to the SEC’s apparent reluctance to approve a spot Bitcoin ETF. Representatives Tom Emmer and Darren Soto wrote to SEC Chairman Gary Gensler in November, questioning the regulator’s refusal to list shares of a spot Bitcoin ETF. Brian Brooks, the CEO of Bitfury and a former Acting Comptroller of the Currency, also stated during a December hearing that the US was “unquestionably” behind the curve in terms of allowing crypto ETFs.
Disclaimer: These are the writer’s opinions and should not be considered investment advice. Readers should do their own research.