The Securities and Exchange Commission (SEC) is currently considering a number of applications for a spot Bitcoin exchange traded fund (ETF). Two leading names in crypto, Mike Novogratz and Cathie Wood, have both publicly stated that they believe the SEC will eventually approve a spot Bitcoin ETF.
Novogratz and Wood believe that the SEC is now more likely to approve a spot Bitcoin ETF, as the market has matured and there are now more safeguards in place to prevent fraud and manipulation. They also believe that a spot Bitcoin ETF would be a major boon for the crypto industry, as it would make it easier for investors to buy and sell Bitcoin.
The SEC is expected to make a decision on the spot Bitcoin ETF applications in the coming months. If the SEC does approve a spot ETF, it would be a major victory for the crypto industry and could lead to a surge in demand for Bitcoin.
Mike Novogratz, CEO of Galaxy Digital, is predicting that a spot Bitcoin ETF will launch within the next four to six months. He cited inside sources at Invesco and BlackRock, two major investment firms that have applied for spot Bitcoin ETF licenses.
Novogratz’s prediction is based on the fact that the SEC has been more receptive to spot Bitcoin ETF applications in recent months. In July, the SEC approved the first futures-based Bitcoin ETF, which allows investors to buy and sell Bitcoin futures contracts. This was seen as a sign that the SEC is warming up to the idea of spot Bitcoin ETFs.
There is a race to get the first spot Bitcoin ETF approved by the SEC. Galaxy Digital, Invesco, BlackRock, and several other firms have all applied for spot Bitcoin ETF licenses.
There are several reasons why there is a race to get the first spot Bitcoin ETF approved. First, a spot ETF would make it easier for investors to buy and sell Bitcoin. Currently, investors have to buy and sell Bitcoin on cryptocurrency exchanges, which can be difficult and risky. A spot ETF would allow investors to buy and sell Bitcoin through traditional brokerage accounts, which would be more convenient and secure.
Second, a spot Bitcoin ETF would likely lead to an influx of institutional capital into Bitcoin. Institutional investors are large financial institutions that manage money on behalf of clients, such as pension funds, endowments, and hedge funds. These investors have been hesitant to invest in Bitcoin in the past, due to concerns about its volatility and lack of regulation. However, a spot Bitcoin ETF would make it easier for institutional investors to invest in Bitcoin, and it would likely lead to a surge in demand for the cryptocurrency.
Third, the first firm to get a spot Bitcoin ETF approved is likely to capture a significant market share. When the SEC approved the first Bitcoin futures ETF in October 2021, the fund saw opening day inflows that dwarfed those of competitors that launched in the following days. This is because investors were eager to get exposure to Bitcoin through a more traditional investment vehicle.
As a result of these factors, there is a lot of competition to be the first firm to get a spot Bitcoin ETF approved. The SEC is expected to make a decision on the spot Bitcoin ETF applications in the coming months. If the SEC does approve a spot ETF, it would be a major victory for the crypto industry and could lead to a surge in demand for Bitcoin.
Cathie Wood and Grayscale are both arguing that the SEC should approve multiple spot Bitcoin ETFs at once. They believe that this would be the fairest way to do it, and that it would avoid the appearance of the SEC picking winners and losers.
The SEC has not yet commented on this argument, but it is something that they will likely consider when making a decision on the spot Bitcoin ETF applications. If the SEC does decide to approve multiple ETFs, it would be a major victory for the crypto industry and could lead to a surge in demand for Bitcoin.
It is important to note that there are also some arguments against approving multiple spot Bitcoin ETFs at once. Some people believe that it would be too risky, as it could lead to a bubble in the cryptocurrency market. Others believe that it would be unnecessary, as the market for Bitcoin is already well-served by the futures-based Bitcoin ETF that was approved in July.
Ultimately, the decision of whether or not to approve multiple spot Bitcoin ETFs is up to the SEC. They will have to weigh the various arguments and decide what is in the best interests of investors.
