‘All indications’ point to Wednesday approval, Thursday launch for bitcoin ETFs: Valkyrie CIO

The Securities and Exchange Commission is expected to make a decision on proposed spot bitcoin ETFs Wednesday. 

If the commission approves the spot bitcoin ETF applications, trading could begin within 24 hours, Bloomberg Intelligence analyst James Seyffart told Blockworks. Such listings could only come if the SEC approves the stock exchanges’ 19b-4 proposals, and deems effective the issuers’ registration statements, known or S-1s (S-3s in Grayscale’s case). 

“I think we’ll get approval tomorrow,” Valkyrie co-founder Steven McClurg told Blockworks Tuesday. “All indications line up with approval [Wednesday], launch Thursday. Of course, anything can happen, right? But, that is what we’re prepared for and when we’re planning to launch.”

While the SEC has not directly told issuers they can expect a decision on Wednesday, that is the consensus from both McClurg and VanEck CEO Jan Van Eck. 

Read more: The SEC may not vote on bitcoin ETFs, but they could still launch

Van Eck told CNBC that he believes the firm’s spot bitcoin ETF could start trading Thursday. 

“We don’t comment on individual filings,” an SEC spokesperson said. “Broadly speaking, if the Commission declares a registration statement effective, that is reflected on EDGAR. Any Commission 19b-4 orders will be posted on our website and then published in the Federal Register.”

Even without public comment from the SEC on the process, it’s clear that the ball is moving when it comes to the bitcoin ETFs. 

“My read on [the Tuesday] amendments,” is that the SEC “is very much engaged and working to kind of hit this deadline,” Haynes Boone partner Matthew Frankle told Blockworks.

McClurg said that, while there’s been no formal indication from the agency, he’s picked up on “clues.”

“The comments that we’re getting are very light,” he said. “When you get comments that are as light as what we just received, it generally means…we’re pretty much there. I don’t expect another round of comments.”

Read more: Why the planned fee for Grayscale’s bitcoin ETF is much higher than others

Roughly 24 hours after filing S-1s on Monday morning, various issuers submitted a new round of registration statements early Tuesday. 

The updated filings include minor changes to disclosures, though some potential issuers — Bitwise, Valkyrie, WisdomTree and Invesco Galaxy — dropped their intended fees. 

McClurg said Valkyrie is “standing by and ready” if the SEC has comments on the re-filings.

The Commission is “trying to get everyone lined up to go on the same exact day,” Seyffart said. 

While it’s not certain that all 11 of the spot bitcoin ETFs could be approved, that’s Seyffart’s base case.

Seyffart says it’s “very indicative” that the SEC is ready to move the process along for the bitcoin ETFs after the Monday morning filings from 10 of the issuers. Hashdex, which was absent from the filings, is going through a different process by seeking to convert its bitcoin futures ETF to also hold BTC directly.

“I don’t know why [the SEC] is set on [starting spot bitcoin ETF trading] on [Jan. 11], but this is coming from them,” Seyffart said. 

The issuers are not pushing for it, “as far as I’m aware,” he added. “The SEC is dictating the process and who’s doing what here.”

If the SEC moves ahead with an approval on Wednesday, then there’s still a bit of paperwork left outside of ensuring that the aforementioned filings are effective. The issuers, Seyffart said, would then need to file for acceleration.

Scott Johnsson, general partner at Van Buren Capital, said Thursday launches would require the acceleration event disclosures to be filed on Wednesday. 

“It’s faster than I’ve ever seen happen,” Johnsson said about Thursday trading.

“With notice of effectiveness posted for Wednesday, most likely,” he continued.

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