Prospective investors hoping for the introduction of a spot Bitcoin (BTC) exchange-traded fund (ETF) in the United States may have to exercise patience.
The Securities and Exchange Commission (SEC) has flagged the recent applications submitted by investment managers as lacking clarity and completeness.
The Wall Street Journal reports that the SEC informed Nasdaq and the Chicago Board Options Exchange (Cboe) that the submissions fell short of requisite transparency and comprehensiveness.
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The SEC expects that these exchanges name the spot Bitcoin exchange they intend to sign a "surveillance-sharing agreement." Alternatively, they should provide detailed information concerning their surveillance arrangements.
While the applications have been deemed insufficient at this stage, the SEC allegedly allowed asset managers to resubmit their filings with the necessary clarifications.
A wave of applications came in over the weeks, triggered by the multinational investment management corporation BlackRock's desire to launch Wall Street's first spot Bitcoin ETF.
It is worth noting that BlackRock's application incorporated a “surveillance sharing agreement,” a measure designed to avoid potential market manipulation.
BlackRock's move has prompted other players like ARK Invest and 21Shares to revise their third application for a spot BTC ETF, introducing a similar surveillance agreement. A slew of asset managers have followed suit in the preceding days, including Invesco, WisdomTree, Valkyrie, and Fidelity. However, industry buzz suggests that ARK Invest might be leading the pack.
It is worth noting that the SEC has consistently rejected spot Bitcoin ETFs since 2017. In contrast, Canada has already embraced this financial product, with prominent funds such as Purpose Bitcoin, 3iQ CoinShares, and CI Galaxy Bitcoin actively investing in spot Bitcoin.
The journey to a US-based spot Bitcoin ETF is fraught with regulatory challenges, and it remains to be seen how these asset managers navigate this landscape.
