Analysts Weigh in on When SEC Might Approve Spot Bitcoin ETF

There are high hopes for the approval of a spot Bitcoin ETF in the U.S. This has led to optimism that Bitcoin’s price will rise, so the entire industry is looking forward to the approval.

However as decisions on the already submitted ETF proposals linger, analysts have thrown in their opinions on when such approval may happen. One of the analysts and CEO of ETC Group, Tim Bevan in an email told the block that he expects the SEC to take decision on all the applications at once.

“The SEC will not want to act as kingmaker given the scrutiny it will attract, and this will take a little more time,” Bevan said. “Hence, we believe January is the earliest we are likely to see approval,” he added.

Meanwhile, Bitcoin has been rally based on the optimism of a Bitcoin ETF approval. The number one crypto asset rose to over $37,000 in the past few days and has managed to hold that price level up to now. It has also risen by 40% over the last month.

Optimism following Grayscale Ruling

The hopes of an ETF approval heightened when in August, a court ruled that the SEC had no reason to turn down the application by Grayscale to convert its current asset management  platform to a spot Bitcoin ETF. The SEC decided not to appeal the ruling at the time, further increasing the optimism.

Interestingly, the agency hasn’t said anything about re-reviewing the Grayscale application. According to Vivian Fang, a finance professor at Indiana University, the SEC has the absolute power to decide when and how it acts on the ruling.

“It sure can wait until the final deadline, although I personally think it will likely make a decision this year,” Fang said. “At least this seems to be priced in by the recent crypto price movements – the market is heating up for near-term approvals of the spot bitcoin ETFs.” 

SEC chair Gary Gensler also confirmed to journalists at the time that the agency was considering multiple applications all at once.

However, analysts at JP Morgan in a recent report said that the optimism that Bitcoin’s price will appreciate with a Bitcoin ETF was baseless.

They argued that spot Bitcoin ETFs already exist in Canada and Europe but have not made any difference and a new ETF in the U.S. isn’t likely to change that.

Making Use of Window

Analysts from JP Morgan have also been involved in speculations concerning when the decision on a Bitcoin ETF could be made. They believe a window has opened for a greenlight by 17 November. 

Two of the analysts James Seyffart and Eric Balchunas said  “Even if approvals don’t arrive this month, we still believe there’s a 90% chance of approval by Jan. 10.”

Also speaking, president of advisory firm The ETF Store, Nathan Geraci, said it is possible that the SEC takes advantage of the short window.

“Issuing 19b-4 approval orders during this window would help keep the SEC on the path towards batching-up all existing spot bitcoin ETF filings to launch at the same time,” Geraci said. The first approvals, if they come, would likely be for 19b-4 filings, which are rule changes that allow spot bitcoin ETFs to list and trade on exchanges,” he added.

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