Spot Bitcoin ETFs have secured landmark approval in the United States
The Securities and Exchange Commission (SEC) has finally approved the United States' first regulated Bitcoin (BTC) exchange-traded funds (ETF) – a decade after receiving the first application.
On January 9, the securities regulator approved Bitcoin ETFs through a rule change that would allow a place for Bitcoin ETFs to be listed and traded on their respective exchanges.
Today the SEC authorized #Bitcoin ETFs to list on all registered national securities exchanges.
Approved Bitcoin ETFs are subject to ongoing monitoring and compliance measures to ensure ongoing investor protection. pic.twitter.com/oJinqv0wcR
— US Securities and Exchange Commission (@SECGov) January 9, 2024
The historic approval paves the way for the first-ever regulated exchange-traded product in the U.S. to directly expose investors to the value of Bitcoin without having to purchase it or worry about self-hedging. Investors instead buy shares in ETFs that hold Bitcoin as their underlying asset.
It comes a decade after Cameron and Tyler Winklevoss filed to launch the Winklevoss Bitcoin Trust in 2013. The SEC has consistently rejected applications for all-in-one Bitcoin ETFs, citing concerns over market manipulation and fraud.
However, after the SEC won a court case in August 2023, the SEC was forced to reconsider its position.
Following the adoption of Bitcoin ETFs, the industry will be watching closely as ETFs begin trading.
Alex Thorne, head of Digital Galaxy Research, estimates that spot Bitcoin ETF revenue could reach $14 billion in the first year, while global fund manager Van Eyck estimates roughly $2.4 billion will flow into spot bitcoin products in the first quarter of 2024.
Launching a spot Bitcoin ETF in the United States requires the SEC to approve both the S-1 (or S-3) and 19b-4 forms filed by issuers.
RELATED: Bitcoin ETF Launch May Be ‘Down' But Could Attract Trillions Over Time
On January 8, ten issuers filed their final amended S-1 and S-3 filings, specifically announcing the fees they plan to charge for their respective Bitcoin ETFs.
BlackRock, the world's largest asset manager, charges 0.2% fees until the fund reaches $5 billion under management (AUM). Bitwise follows closely behind with 0.24%, while Ark 21Shares and VanEck follow slightly behind with 0.25% fees.
Specifically, Arch21 shares waive all fees for the first six months or until the product reaches $1 billion in AUM.
Greyscale currently stands as the highest yielding Bitcoin ETF, throwing a 1.5% payout rate to its future investors.
This is a developing story, and more information will be added as it becomes available.
Magazine: Legislators' fear and skepticism fuel proposed crypto regulations in the US.
