- ETF, Spot Bitcoin Exchange-Traded Funds, are something that is designed to track the performance of Bitcoin with the custody of the asset.
- ETFs are also considered a type of investment that helps people track a specific asset or a commodity.
However, this is the article that will talk about ETFs, which are always bought and sold on various stock exchanges and brokerage accounts. Also, people need to make sure that with the custody of the underlying asset being held by the manager of the ETF, after some days, it would allow investors to get price exposure to Bitcoin that too without having to worry about self-custody.
What Is A Spot Bitcoin ETF?
So, here, people will understand the spot Bitcoin ETF, which is an exchange-traded fund that always tracks the price of Bitcoin. Now, people need to make sure that the term ‘spot’ refers to the actual immediate purchase and ownership of the underlying asset.
Sometimes, it should be noted that different investors and traders do not own Bitcoin themselves, as they own a share of the ETF.
Why Bitcoin Spot ETF Took So Long For Approval?
There are Spot Bitcoin ETF applications that have been denied by the SEC multiple times and yes, from many different issuers. Also, in the past, the SEC claimed that the reason applications were denied was just because the issuer did not include a surveillance sharing agreement with a regulated market of significant size that is related to Bitcoin.
This is the stated reason for the agreement and it is in order to prevent market manipulation. Also, the SEC claims all these types of surveillance-sharing agreements allow for a thorough investigation of some type of market manipulation.
Now, the recent onslaught of applications has come on the heels of BlackRock filing for the iShares Bitcoin Trust, which included a very new provision for surveillance-sharing agreements. So, this new filing, which is paired with BlackRock’s near-perfect record of ETF approvals, makes it always seem like a favorable ruling.
Expectations Of The First Spot Bitcoin ETF To Go Live
People need to make sure that there is a promising timeline for when a spot BTC ETF might get approved. There are different deadlines given for when the SEC must respond to each filing.
Also, ARK 21 is the one that shares the Bitcoin ETF, which was the first to recently file, and yes, the final decision deadline is January 10, 2024. But, as per some reports, it is possible that the SEC will make decisions at one of the earlier deadlines. Additionally, the estimates are increased for the approval and launch of a spot Bitcoin ETF in the US this year.
Conclusion
Lastly, people need to know that Bitcoin held in self-custody is a very revolutionary tool for financial freedom. Also, a spot Bitcoin ETF offers a very regulated and accessible way for investors to gain exposure to Bitcoin without having to explore unfamiliar cryptocurrency exchanges.