The market is filled with expectations as the possibility of the United States Securities and Exchange Commission (SEC) approving a Bitcoin ETF by the end of this month looms. Steven McClurg, the Chief Investment Officer (CIO) of Valkyrie Investments, expressed his confidence that the SEC could grant approval in the near future.
One of the key players in this battle for Bitcoin ETF approval is Valkyrie Investments, a firm that manages two Bitcoin-related ETFs and has an active application in place. The firm is in the fight alongside other financial institutions such as BlackRock, Fidelity, VanEck, and Invesco.
McClurg highlights the expectation of additional comments from the SEC in the coming weeks, which could pave the way for the approval of changes to the 19b-4 rule before the end of the month. If this happens, the ETF’s launch could take place in February.
The anticipation surrounding a Bitcoin ETF is not just speculation; we expect strong investor interest. We estimate that these products could attract approximately $10 billion in the first one or two months after the launch.
Longer-term projections are even more ambitious, with some experts suggesting that we could see investment flows exceeding $50 billion within a five-year period.
Bitcoin ETFs Under Intense Scrutiny
However, not everything is good news. Despite the anticipation and optimism in the market, there are several concerns.
The SEC is conducting a thorough scrutiny of Bitcoin ETF applications, paying special attention to areas such as risk disclosures, index usage methodology, Net Asset Value (NAV) calculations, environmental risks, and custody practices.
Market manipulation and custody concerns, in particular, remain potential obstacles on the path to approval.
Major market players, including giants like BlackRock and VanEck, have amended their ETF applications to provide more details on how they would conduct the initial fund seeding in an effort to address these concerns.
The most recent development is Valkyrie’s submission of a revised application for an ETF that the Nasdaq Stock Market would list under the ticker “BRRR.”
This move is part of a broader trend, as several firms have resubmitted their Bitcoin ETF applications, signaling a concerted effort toward regulatory compliance and hope for approval.
