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The
U.S.
Securities
and
Exchange
Commission
on
Wednesday
approved
rule
changes
to
allow
the
creation
of
bitcoin
exchange-traded
funds
in
the
U.S.,
a
long-awaited
move
that
will
give
regular
investors
access
to
the
controversial
and
volatile
cryptocurrency.
The
decision
will
likely
lead
to
the
conversion
of
the
Grayscale
Bitcoin
Trust,
which
holds
about
$29
billion
of
the
cryptocurrency,
into
an
ETF,
as
well
as
the
launch
of
competing
funds
from
mainstream
issuers
such
as
BlackRock’s
iShares
and
Fidelity.
The
first
funds
are
poised
to
begin
trading
Thursday.
The
approval
may
prove
to
be
a
landmark
event
in
the
adoption
of
cryptocurrency
by
mainstream
finance,
as
the
ETF
structure
gives
institutions
and
financial
advisors
a
familiar
and
regulated
way
to
buy
exposure
to
bitcoin.
“We
think
that
the
SEC
approval,
should
we
and
others
get
it,
is
a
green
light
for
institutions.
We’ve
been
talking
to
quite
a
few
of
them,
and
they’re
much
more
interested
now
that
the
SEC
effectively
is
paving
the
way,”
Ark
Invest
CEO
Cathie
Wood
said
on
CNBC’s
“Halftime
Report”
on
Monday.
Ark
Invest
has
partnered
with
21Shares
on
a
proposed
bitcoin
fund.
watch
now
The
decision
comes
after
an
official
SEC
social
media
account
on
Tuesday
falsely
said
that
bitcoin
ETFs
had
been
approved.
The
SEC
said
the
account
had
been
compromised.
The
regulator
has
for
years
opposed
a
so-called
spot
bitcoin
fund,
with
several
firms
filing
and
then
withdrawing
applications
for
ETFs
in
the
past.
SEC
Chair
Gary
Gensler
has
been
an
outspoken
critic
of
crypto
during
his
tenure.
However,
the
regulator
appeared
to
change
course
on
the
ETF
question
in
2023,
possibly
due
in
part
to
an
August
loss
to
Grayscale
in
a
court
decision
that
criticized
the
SEC
for
blocking
bitcoin
ETFs
while
allowing
funds
that
track
bitcoin
futures.
“Importantly,
today’s
Commission
action
is
cabined
to
ETPs
holding
one
non-security
commodity,
bitcoin.
It
should
in
no
way
signal
the
Commission’s
willingness
to
approve
listing
standards
for
crypto
asset
securities.
Nor
does
the
approval
signal
anything
about
the
Commission’s
views
as
to
the
status
of
other
crypto
assets
under
the
federal
securities
laws
or
about
the
current
state
of
non-compliance
of
certain
crypto
asset
market
participants
with
the
federal
securities
laws,”
Gensler
said
in
a
statement
Wednesday.
Optimism
around
approval
first
reemerged
this
year
after
asset
management
giant
BlackRock
filed
an
application
in
June,
leading
to
a
flood
of
applications
from
its
rivals.
The
partnership
of
Ark
Invest
and
21Shares
has
the
longest
active
filing,
and
a
deadline
for
the
SEC
on
the
fund
in
January
led
many
industry
experts
to
expect
that
the
first
bitcoin
ETFs
would
be
approved
shortly
after
the
start
of
2024.
watch
now
More
than
10
different
firms
are
now
in
the
formal
process
toward
a
launch,
with
the
competition
to
become
one
of
the
market
leaders
expected
to
include
differing
expense
ratios
and
a
heavy
marketing
blitz.
Several
firms
have
already
cut
their
original
proposed
fee.
It
is
not
guaranteed
that
all
applications
will
lead
to
a
fund
entering
the
market.
The
Cboe
website
on
Wednesday
afternoon
indicated
that
several
of
the
bitcoin
ETFs
would
begin
trading
on
its
BZX
exchange
on
Thursday.
The
anticipation
of
the
ETF
also
appears
to
have
boosted
the
price
of
bitcoin
in
recent
months.
Some
crypto
advocates
believe
the
arrival
of
bitcoin
ETFs
will
unleash
new
demand
for
asset
class
from
types
of
investors
who
were
previously
scared
off
by
concerns
about
custody
and
the
safety
of
crypto-specific
exchanges.
The
approval
of
the
ETFs
comes
after
a
year
that
saw
major
law
enforcement
action
against
crypto
firms
and
industry
leaders,
including
the
conviction
of
FTX
founder
Sam
Bankman-Fried
and
multiple
actions
against
Binance
and
its
founder
Changpeng
Zhao.
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