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- The SEC has formally postponed its responses to spot bitcoin ETF applications from Ark 21 Shares and Global X. This means that these applications will now face a longer waiting period before the SEC makes a decision.
- Budget negotiations loom following the recent SEC move. This step by the SEC to decide on extending the deadlines coincides with budget negotiations in Congress, which could lead to a government shutdown. This proactive action aims to ensure that the SEC has sufficient time to consider these applications.
- Ark Investment Management and 21Shares, i.e. the companies that have been pursuing ETF approval since 2021, refiled their bitcoin ETF applications earlier this year. The formal deadline for an SEC response to these applications is now set for January 10.
- Global X, a recent applicant for the same, is seeking to become the ninth active spot-bitcoin ETF. It now has until November 21 to await the SEC’s response. If approved, this ETF could offer investors exposure to Bitcoin with enhanced protections.
In a proactive move, the U.S. Securities and Exchange Commission (SEC) has decided to extend deadlines for responding to spot bitcoin ETF applications. This comes as Congress faces budget negotiations, raising concerns about a potential government shutdown. The SEC’s decision impacts applications from Ark 21 Shares and Global X, which are seeking approval to list spot bitcoin exchange-traded funds (ETFs).
What is happening with the SEC?
While the SEC has previously rejected spot bitcoin ETF products due to concerns about potential market manipulation and insufficient investor protections, a recent federal court ruling has called the agency’s decisions into question, stating that they were “arbitrary and capricious.” This ruling has prompted the SEC to reconsider its position.
The SEC typically takes the full 240 days to make a final decision on such applications. However, the looming threat of a government shutdown seems to have expedited their interim decision. Normally, the SEC waits until just a few days before the deadline to act. In fact, during the last government shutdown in 2019, the SEC requested an applicant to withdraw its filing altogether.
In its recent filings, the SEC explained that it believes designating a longer period for decision-making is appropriate, allowing the regulator sufficient time to carefully consider each application.
The SEC’s decision to extend deadlines for spot bitcoin ETF applications reflects its commitment to thorough evaluation, especially in light of recent legal challenges. This move ensures that investors and stakeholders have confidence in the regulatory process. As the budget negotiations in Congress continue, the crypto industry will closely monitor these developments.
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