Bitcoin ETF: SEC May Notify Approved Issuers To Launch Very Soon

According to a recent report from Reuters, the US Securities and Exchange Commission (SEC) may notify the asset managers looking to launch a spot Bitcoin ETF (exchange-traded fund) if their applications have been approved as soon as next week. 

SEC To Notify Applicants Of Its Decision By Next Week: Reuters

On Saturday, December 30, Reuters reported that the SEC may notify the 14 Bitcoin ETF applicants if their applications will be approved by Tuesday or Wednesday next week. This move would come ahead of the January 10 deadline for the agency to decide whether or not to green-light the ETF application by Ark Invest and 21Shares.

Citing people familiar with the process, Reuters highlighted that asset managers that met their end-of-the-year filing revision deadlines may be able to launch by January 10, 2024. Some of the firms that recently updated their Bitcoin ETF filings with the SEC include Black Rock, Van Eck, Bitwise, WisdomTree, Invesco, Valkyrie, and Fidelity.

Notably, Fidelity Investments revealed more information and technical details about its potential ETF product in its S-1 form update. The asset management firm hopes to beat fellow applicants in winning investors over by proposing the lowest sponsor fee at 0.39%.

Invesco announced a 0.59% rate while offering a fee waiver on the first $5 billion in assets within the first six months after launch. Meanwhile, BlackRock, the world’s largest asset manager and a frontrunner in the Bitcoin ETF race, unveiled Jane Street Capital and JP Morgan Securities as its authorized participants in its updated application. 

From the latest development, it seems the SEC is looking to wrap up the Bitcoin ETF chapter as soon as the new year arrives. Nonetheless, Reuters’ latest report adds optimism to the possibility of the agency approving several ETF applications by January 10.

How Bitcoin ETF Approval Could Impact Price

There have been wide speculations on the possible effects of the ETF approval on the Bitcoin asset. Options platform Greeks.live has offered insight into the potential impact of the exchange-traded fund on the value of the premier cryptocurrency.

There is news in the market that the SEC will pass the Bitcoin Spot ETF application as early as next Tuesday, but there was little volatility across the major term IVs and the price.
Looking at the options data, Jan12 options IV, which is strongly correlated to the ETF, fell… pic.twitter.com/f1B4ZPC05d

— Greeks.live (@GreeksLive) December 31, 2023

Using options data, Greeks.live believes that the market has priced the potential approval of the Bitcoin ETF, and it may not yield greater returns for the asset. This means that the market has already factored in this information, and any positive development might not lead to significant price movement.

According to the platform, this reasoning is based on the little volatility observed across the major term implied volatilities (IVs) and the price of Bitcoin. For context, implied volatility reflects the market’s expectation of how much an asset will move in the future. 

However, options IV on January 12, which is believed to be strongly correlated to the Bitcoin ETF, decreased rather than increased. This lack of volatility and decrease in implied volatility of options suggests that there may not be a substantial impact on the Bitcoin price, even with significant news on the horizon. 

As of this writing, Bitcoin is valued at $42,154, reflecting a mere 0.4% in the past day. The price of BTC has increased by more than 150% this year, partly due to the anticipation of a Bitcoin spot ETF.

Bitcoin price continues to move sideways on the daily timeframe | Source: BTCUSDT chart on TradingView

Featured image from iStock, chart from TradngView

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