Bitcoin (BTC) is skyrocketing after the U.S. Securities and Exchange Commission (SEC) approved a slew of bids to create spot market BTC exchange-traded funds (ETFs). The highly anticipated move by the regulatory agency – which saw it approve the applications of several marquee firms such as BlackRock (IBIT), Fidelity (FBTC), Invesco (BTCO), ARK Invest (ARKB), […]
The post Bitcoin (BTC) Reaches $49,000 As Spot ETFs Kick Off Trading in the US After SEC Approval appeared first on The Daily Hodl.
The SEC is pushing Bitcoin ETF issuers down the cash create route for creation and redemptions, but BlackRock has other ideas.
As spot Bitcoin exchange-traded fund (ETF) issuers iron out details of their filings with the U.S. securities regulator, it appears that the SEC is steadfast in demanding a “cash” redemption model rather than alternative model proposed by other issuers, such as BlackRock.
On Dec. 14 finance lawyer Scott Johnsson said that ETF applicant Invesco has become the latest to bend the knee to using a cash creation and redemption model for its ETF.
Seyffart also noted that Bitwise has been set for cash-only creates/redeems since Dec. 4, “though for months they had in-kind or cash in their documents before this.”
Earlier in the day, BlackRock registered corporate entity “iShares Ethereum Trust” in Delaware, the first hint that a filing for a spot Ethereum ETF filing was imminent.
Blackrock’s plans for a spot Ethereum exchange-traded fund (ETF) has now been confirmed, per a 19b-4 form filing submitted to the United States Securities and Exhange Commission on Nov. 9.
Nasdaq filed the 19b-4 form to securities regulator on behalf of the $9 trillion asset management firm for a proposed ETF called the "iShares Ethereum Trust."
The move signals BlackRock’s intention to expand beyond Bitcoin with its ETF aspirations.
Earlier on Nov. 9, it emerged that BlackRock registered corporate entity iShares Ethereum Trust in Delaware, the first hint that a spot Ethereum ETF filing could be imminent.
UPDATE: BlackRock #Ethereum ETF confirmed. They just submitted a 19b-4 filing with Nasdaq pic.twitter.com/pLhuhhK7jo
— James Seyffart (@JSeyff) November 9, 2023
BlackRock and other financial firms have expressed interest in cryptocurrency-backed ETFs over the last few months.
Bloomberg ETF analyst James Seyffart noted that there are at least five firms in the running to win the Securities and Exchange Commission’s approval for a spot Ethereum ETF.
Related: Ethereum futures ETFs garner lukewarm reception on first day of trading
Among them are VanEck, ARK 21Shares, Invesco, Grayscale and Hashdex.
There are 5 other live spot Eth filings that i'm aware of:@vaneck_us @ARKInvest/ @21Shares @hashdex @InvescoUS/ @galaxyhq
— James Seyffart (@JSeyff) November 9, 2023
andddd @Grayscale's filing to convert $ETHE.
In no particular order.
Ether (ETH) spiked 8.9% to $2080 on the news that BlackRock is moving forward its plans for an iShares Ethereum Trust and is up 10.1% over the last 24 hours, according to CoinGecko.
The price surge has helped ETH claw back some market dominance against Bitcoin (BTC), which has outperformed ETH in recent months.
ETH’s market dominance now sits at 17%, up 1.3% percentage points prior to the news.
Bloomberg ETF analysts raised their odds for a spot Bitcoin ETF approval after the recent Grayscale victory against the SEC.
Bloomberg analysts have raised the probability for an approved spot Bitcoin exchange-traded fund (ETF) by the end of 2023, following a recent Grayscale victory against the federal securities regulator.
In a Aug. 30 post on X (Twitter), Bloomberg senior ETF analyst Eric Balchunas said they have raised the chances to 75% from an earlier 65% — due to the unanimity and decisiveness at which the United States Court of Appeals Circuit reached its decision in the recent case.
“The judges unanimously repudiated the SEC’s arguments, and the agency will struggle to justify further denials as it faces deadlines,” Bloomberg analysts James Seyffart and Elliot Stein added in a separate Aug. 30 note.
NEW: @JSeyff & I are upping our odds to 75% of spot bitcoin ETFs launching this yr (95% by end of '24). While we factored Grayscale win into our prev 65% odds, the unanimity & decisiveness of ruling was beyond expectations and leaves SEC w "very little wiggle room" via @NYCStein pic.twitter.com/IyEGmWjuHa
— Eric Balchunas (@EricBalchunas) August 30, 2023
In his own post on X, Seyffart added that spot Bitcoin ETF approvals will likely be a “done deal” by Q4 2024, estimating the approval odds to have now skyrocketed to 95% by then.
Balchunas added that given the recent legal and public relations loss, a denial by the SEC will be “politically untennable.”
Beyond the legal loss, there is also the PR loss (which matters bc it sets narratives, changes minds). And this got covered far and wide in mainstream media incl NYT, WSJ, CNN, AP, ABC & on and on. We think the legal and PR loss will combine to make denial politically untenable. pic.twitter.com/Uarh5CszXC
— Eric Balchunas (@EricBalchunas) August 30, 2023
Related: Grayscale wins the court battle, but what does this mean for a spot Bitcoin ETF?
Over the next five days, seven Bitcoin spot ETF applications are due for a “first deadline” decision by the SEC, including Bitwise, BlackRock, VanEck, Fidelity, Invesco, Wisdomtree and Valkyrie.
Balchunas said he “wouldn’t be surprised” if the SEC delays these upcoming Bitcoin spot ETF applications.
But the most likely outcome will be that we unexpectedly wake up to the SEC giving in and approving the Bitcoin spot ETFs in one hit, he said.
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“We’re going to fight like cats and dogs to win market share” once spot Bitcoin ETFs are approved, Galaxy Digital CEO Mike Novogratz told shareholders.
The United States’ first spot Bitcoin (BTC) exchange-traded fund (ETF) could be approved sometime before February 2024, according to Galaxy Digital CEO Mike Novogratz — citing sources at BlackRock and Invesco.
“It's a big, big deal. It's a big deal because both our contacts, from the Invesco side and from the BlackRock side, get you to think that this is a question of when, not if — that the outside window is probably six months,” Novogratz told shareholders during Galaxy’s Aug. 8 Q2 earnings call, which reported a $46 million net loss.
“This is probably [...] four to six months if you had to put a ‘pin the tail on the donkey’ on it, that the SEC is going to approve a Bitcoin ETF.”
Novogratz’s Galaxy Digital is one of the many contenders for a spot Bitcoin ETF, which it reapplied for in June in conjunction with $1.5 trillion asset manager Invesco — the fourth-largest ETF issuer in the U.S.
According to "contacts" from inside BlackRock and Invesco spot Bitcoin ETF approval a matter of "when, not if" likely in "four to six months" -- Galaxy CEO Mike Novogratz on earnings call this morning pic.twitter.com/TIhHC7xnHI
— Eric Balchunas (@EricBalchunas) August 8, 2023
Speaking to shareholders, Novogratz said he didn’t have a comment on the expected timing of the ETF’s approval, which is an unknown as it sits with the Securities and Exchange Commission.
However, Novogratz believes that once approved, spot Bitcoin ETF issuers such as BlackRock and Invesco will be fighting tooth and nail for market share.
“The news of both BlackRock filing ETF and quite frankly, Invesco Plus Galaxy, we're going to fight like cats and dogs to win market share there once it gets approved.”
In response to a question, Galaxy Digital president Chris Ferraro added he wouldn’t be surprised if the SEC ends up approving a potential Bitcoin ETF to avoid being labeled as “obstructionist.”
“I think that's where the potential ETF approval comes in saying, hey, you can't call us anti-crypto, we just approved an ETF. And so we're hoping that that's the same for our filing," said Ferraro.
Meanwhile, some analysts believe the wave of spot Bitcoin ETFs could come even sooner, depending on how a judge rules in Grayscale’s lawsuit against the SEC.
Related: ETF analyst raises spot Bitcoin ETF approval chances in the US to 65%
Grayscale last year sued the SEC for rejecting its application to convert its Grayscale Bitcoin Trust into a spot ETF.
"If the SEC loses its case against @Grayscale, as we expect, the path of least resistance would be a wave of simultaneous approvals for all spot #Bitcoin ETF applicants -- including Grayscale and the other eight active filings." @NYCStein in @Bloomberg today. Cc @EricBalchunas… pic.twitter.com/k72W6Ek7RK
— Craig Salm (@CraigSalm) August 2, 2023
Analysts believe that should the SEC lose its case against Grayscale, the “path of least resistance” would be simultaneous approvals for several or all spot Bitcoin ETF applicants.
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The CEO believes investors will be inclined to seek exposure to Bitcoin in a more familiar, structured and protected regulatory environment.
Australian-based crypto investment firm Monochrome Asset Management has updated its application to offer a spot Bitcoin (BTC) exchange-traded fund (ETF) on the Australian Securities Exchange (ASX) through its partner Vasco Trustees.
The ETF — Monochrome Bitcoin ETF — will be able to offer retail Australian investors direct exposure to Bitcoin and Ether (ETH), according to the firm’s July 14 announcement.
Australia joins the #Bitcoin race.#spot #bitcoinetf @MonochromeAsset https://t.co/hqXb9RY5HL pic.twitter.com/KEEXHQ9Eo6
— Jeff (@jeffyew_) July 13, 2023
Speaking to Cointelegraph, Monochrome CEO Jeff Yew explained that by obtaining a license, Australian retail investors would be exposed to Bitcoin within a formidable regulatory landscape:
“Through a Bitcoin ETF, it makes it possible for them to buy and use the asset class in however they see fit with the investment choices [and] in a regulated manner, and also operating within the regular regulatory perimeter.”
“So that is the benefit, I guess, compared to, say, unregulated exchanges where there’s no investor protection,” he added.
Yew believes that if a Bitcoin ETF goes live on ASX, it will send a “clear signal” to traditional investors that the “unregulated Wild West is coming to an end” because their investments will be backed by a “familiar,” “structured” and “protected environment.”
Vasco, its “Responsible Entity Partner,” is authorized under an Australian Financial Services Licence to offer retail investors regulated exposure to the cryptocurrency market, the firm stated.
Related: Bitcoin ETF is the needed ‘seal of approval’ for BTC — Mike Novogratz
Spot Bitcoin ETF applications have been a focus point for the industry lately, particularly in the United States. In recent weeks, the industry has seen spot Bitcoin ETF filings from major financial firms, including Fidelity, Invesco, Wisdom Tree, Valkyrie and the $10 trillion asset management firm BlackRock.
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The surveillance-sharing agreements are a measure recommended by the SEC in March, which says they can prevent fraud and protect investors.
Exchange operator Cboe Global Markets has amended five spot Bitcoin (BTC) Exchange-Traded Fund (ETF) applications to include a surveillance-sharing agreement (SSA) with Coinbase.
On July 11, Cboe amended filings with the United States Securities and Exchange Commission (SEC) for the ETFs from Invesco, VanEck, WisdomTree, Fidelity and the joint fund by ARK Invest and 21Shares.
Cboe said it had "reached an agreement on terms with Coinbase" to enter into the SSA's which were settled on June 21. The initial filings for the ETFs stated the parties were "expecting to enter" an SSA prior to potentially offering the ETFs.
The SSAs are an attempt to meet the SEC's standards aimed at preventing fraudulent conduct and protecting investors, as outlined by the regulator on March 10:
“[An exchange needs] a comprehensive surveillance-sharing agreement with a regulated market of significant size related to the underlying or reference bitcoin assets.”
Spot Bitcoin ETF applications have been a focus point for the industry lately. The filings by Fidelity, Invesco, Wisdom Tree and Valkyrie follow the $10 trillion asset management firm BlackRock which also filed an ETF for SEC approval.
Related: Why a Bitcoin ETF approval would be a big deal
On June 29, the U.S. stock exchange Nasdaq also refiled its application to list BlackRock's ETF, similarly inclusive of an SSA with Coinbase.
Cboe's filings pushed Coinbase (COIN) shares up nearly 10% on June 11, the highest price it's reached since August 16, according to Google Finance.
Despite the involvement with Bitcoin ETF applications, Coinbase is currently battling out a lawsuit with the SEC for allegedly offering cryptocurrencies the regulator considers to be unregistered securities.
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Bitcoin investment products have experienced $310.6 million in inflows over the last two weeks.
Bitcoin (BTC) has been the “primary focus” for institutional investors over the last two weeks, according to Coinshares, as the cryptocurrency continues to hit new prihighs for 2023.
In a July 3 report from CoinShares’ Head of Research James Butterfill, the analyst noted that Bitcoin-related products saw $310.6 million of inflows over the last two weeks, representing the vast majority of crypto product inflows.
“Bitcoin remained the primary focus of investors [...] with the last 2 weeks inflows representing 98% of all digital asset flows,” said Butterfill.
The last two weeks of inflows are a reversal from the previous nine consecutive weeks of outflows. Short Bitcoin products also experienced a minor outflow of $0.9 million over the last week.
It’s the second time this year that Bitcoin products have accounted for 98% of inflows into cryptocurrency investment products, and comes amid a surge in Bitcoin’s price and dominance.
Much of this surge has been pinned on BlackRock’s June 15 spot Bitcoin ETF application, followed by similar filings from the likes of Fidelity, Invesco, Wisdom Tree and Valkyrie.
Since the filing, the price of Bitcoin has increased 25.2% to $31,131 at the time of writing. Bitcoin's dominance — which is a measure of its market cap relative to the total market cap of all cryptocurrencies — has risen to 51.46%, according to data.
Bitcoin Fear and Greed Index is 64 — Greed
— Bitcoin Fear and Greed Index (@BitcoinFear) July 4, 2023
Current price: $31,158 pic.twitter.com/Tl8vVQp9GA
Meanwhile, Ethereum investment products inflows came in at $2.7 million last week, the second week of inflows that have reversed a lengthy outflow trend.
Related: Why approving a Bitcoin ETF might unleash $18B in sell-pressure
Speaking to Cointelegraph on June 26, Fireblocks CEO Michael Shaulov said there has been a “fair amount of interest” from institutional investors in core assets such as Bitcoin and Ethereum, but less so in alternate cryptocurrencies.
“The narrative around Ethereum is pretty much the understanding that future ecosystems of tokenizeation are likely to be EVM-based. And if they’re EVM based, then Ethereum is going to play out as utility.”
Shaulov said the narrative around Bitcoin has been less specific, but notes that most investors see the need to hold the cryptocurrency.
Magazine: Hall of Flame: William Clemente III tips Bitcoin will hit six figures toward end of 2024
With spot Bitcoin ETFs filings helping boost the price of Bitcoin, some suggest the “window to front-run institutional demand is closing.”
Recently renewed optimism for an approved Bitcoin (BTC) spot exchange-traded fund (ETF) is igniting “The Great Accumulation Race” for Bitcoin, according to industry pundits.
Over the past week, Fidelity, Invesco, Wisdom Tree and Valkyrie have followed investment giant BlackRock in applying for a Bitcoin spot ETF with the United States Securities Exchange Commission, which some analysts believe is the reason for Bitcoin’s 19% price surge to $30,240 since June 16.
5 Bitcoin ETF applications in 5 days!
— Lark Davis (@TheCryptoLark) June 21, 2023
- Blackrock
- Fidelity
- Invesco
- Wisdom Tree
- Valkyrie
Cameron Winklevoss, the co-founder of cryptocurrency exchange Gemini, stated on June 21 that he believe“The Great Accumulation” of Bitcoin has begun between institutions and retail investors.
He suggested that buying Bitcoin prior to the ETFs hitting the public market is akin to that of a pre-Initial Public Offering purchase and suggested that the “floodgates” for buying Bitcoin are “closing fast.”
The Great Accumulation of bitcoin has begun. Anyone watching the flurry of ETF filings understands the window to purchase pre-IPO bitcoin before ETFs go live and open the floodgates is closing fast. If bitcoin was the most obvious and best investment of the previous decade, this…
— Cameron Winklevoss (@cameron) June 21, 2023
MicroStrategy Chair Michael Saylor weighed in on the subject in his own post, suggesting that retail investors may soon be pushed aside by increasing institutional demand:
“The window to front-run institutional demand for Bitcoin is closing.”
Bitcoin is currently trading hands for $30,240, while the Crypto Fear and Greed index has skyrocketed from 49 (Neutral) to 65 (Greed) in just the last two days.
In a June 21 interview with CNBC, Bitcoin investor Anthony Pompliano said he expects a tug-of-war to play out between retail investors and Wall Street:
“We have institutions and individuals scrambling to try to get their share of the 21 million Bitcoin that will ever be in existence. The retail investor for 15 years now has a head start and has accumulated all the Bitcoin that’s been mined and put into circulation, but 68% of that hasn’t moved in a year.”
“People forget that bitcoin went from $0 to nearly $1 trillion market cap with almost no institutional participation,” said Pompliano in a June 21 Twitter post.
So when “Wall Street and BlackRock show up to the market,” Pompliano expects Bitcoin to become “highly illiquid” because retailers “don’t want to sell to Wall Street,” he added during the CNBC interview.
BlackRock shows up and bitcoin is up 20% for the week.
— Pomp (@APompliano) June 21, 2023
People forget that bitcoin went from $0 to nearly $1 trillion market cap with almost no institutional participation.
If retail investors were good for $1T, what do you think happens when the deep pockets come play?
Related: Grayscale Bitcoin Trust nears 2023 highs on BlackRock ETF filing as buyers step up
Meanwhile, Dylan LeClair, a Bitcoin analyst and founder of 21st Paradigm explained that Bitcoin’s price is now “extremely inelastic” — “more so than ever” — amid the recent ETF filings, which are serving as a “catalyst” for large amounts of new flows into the market.
However, LeClair predicts that no ETF application will be approved by the SEC until January or February 2024 at the earliest.
Bitcoin's supply is extremely inelastic, more so than ever currently.
— Dylan LeClair (@DylanLeClair_) June 21, 2023
A spot ETF is obviously a catalyst for a large amount of new flows to come into the market, which not only has changed the narrative but has prompted others to front run said future flows.
TLDR: Send it. pic.twitter.com/Jd8Gm8o3Mx
Magazine: Hall of Flame: William Clemente III tips Bitcoin will hit six figures toward end of 2024
