The race for spot Bitcoin exchange-traded funds (ETFs) has intensified as two investment firms recently filed applications, following BlackRock’s move to seek approval for its spot Bitcoin ETF on June 15.
BlackRock leads other firms in filing their spot Bitcoin ETF application
WisdomTree, an asset management fund based in New York, is the latest firm to file a new application for a spot Bitcoin ETF. In a filing to the United States Securities and Exchange Commission (SEC) on June 21, WisdomTree requested permission to list its “WisdomTree Bitcoin Trust” on the Cboe BZX Exchange under the ticker symbol “BTCW.”
This is not WisdomTree’s first attempt at a spot Bitcoin ETF. The SEC rejected its initial application in December 2021, and the second application faced rejection again in October 2022, with concerns raised about fraud and market manipulation. Currently, WisdomTree manages approximately $83 billion in assets.
One notable difference in BlackRock’s recent filing is its intention to enter into a “surveillance sharing agreement” with the Chicago Mercantile Exchange (CME) futures markets. BlackRock refers to the SEC’s approval of a Bitcoin futures fund by Teucrium, noting the CME’s comprehensive surveillance of futures market conditions to detect and prevent price distortions caused by manipulative efforts. WisdomTree’s filing also mentions its willingness to enter into a similar surveillance agreement with an operator of a US-based spot trading platform for Bitcoin.
Shortly after WisdomTree’s application, global investment manager Invesco “reactivated” its application for a similar product. Invesco submitted a request to the SEC, seeking approval for its “Invesco Galaxy Bitcoin ETF” to be listed on the Cboe BZX exchange. The filing highlights that a spot Bitcoin ETF utilizing professional custodians and service providers eliminates the need for investors to rely on loosely regulated offshore vehicles, offering better protection for their principal investments in Bitcoin.
Fidelity investments could make a late entry into the market
While the SEC has yet to approve a spot Bitcoin ETF, Bloomberg senior ETF analyst Eric Balchunas believes that BlackRock’s move has injected new energy into the race. Balchunas shared on Twitter that BlackRock has a successful track record of getting ETFs approved, with a record of “575-1” in favor of approval by the regulator.
Amidst this flurry of activity, rumors have emerged that Fidelity Investments, a multi-trillion-dollar fund manager overseeing $4.9 trillion in assets, may also be considering entering the spot Bitcoin ETF market. A tweet from Arch Public co-founder AP_Abacus suggested that Fidelity Investments might file its spot Bitcoin ETF or make an offer on Grayscale’s GBTC ETF product.
As the competition for spot Bitcoin ETFs heats up, investors and market observers are closely watching the regulatory developments and the potential impact on the cryptocurrency market. The approval of a spot Bitcoin ETF could offer investors a regulated and accessible way to invest in Bitcoin, potentially leading to increased adoption and liquidity in the cryptocurrency space. However, it remains to be seen how the SEC will assess these new applications and address the concerns regarding fraud, market manipulation, and investor protection.
As the race for spot Bitcoin ETFs intensifies, market participants will eagerly await updates from the SEC, and the decisions made regarding these filings will likely shape the future of cryptocurrency investment opportunities in the United States.
