Invesco Seeks Approval for Spot Bitcoin ETF

Invesco, a global asset manager with $1.5 trillion under management, has refiled for a spot Bitcoin ETF after two years of waiting. The company submitted a new Form 19b-4 to the US Securities and Exchange Commission (SEC) on June 21, 2023, requesting approval for the Invesco Galaxy Bitcoin ETF. The proposed fund would track the performance of Bitcoin and hold the cryptocurrency in custody with Galaxy Digital Assets LLC.

The Invesco Galaxy Bitcoin ETF is one of several spot Bitcoin ETF applications that have been filed or revived in recent weeks, following the lead of BlackRock, the world’s largest asset manager. BlackRock filed for a spot Bitcoin ETF on June 15, 2023, citing the SEC’s authorization of Teucrium’s Bitcoin futures fund as a precedent.

Teucrium is an investment advisory company that offers exposure to Bitcoin futures contracts traded on the Chicago Mercantile Exchange (CME).

Spot Bitcoin ETFs are Gaining Increasing Popularity

Spot Bitcoin ETFs differ from futures-based ones in that they directly invest in the underlying asset, rather than in derivatives contracts. These are seen as more favorable by many investors and analysts, as they offer lower fees, higher liquidity, and more accurate price discovery. 

However, spot Bitcoin ETFs also face higher regulatory hurdles, as the SEC has expressed concerns about market manipulation, fraud, and custody issues in the cryptocurrency market.

The SEC has yet to approve any spot Bitcoin ETF in the US, despite receiving dozens of applications over the years. The regulator has repeatedly delayed or rejected the proposals, citing the need for more investor protection and market surveillance. 

In addition to Invesco and BlackRock, other investment firms that have applied for spot Bitcoin ETFs include WisdomTree, Fidelity Investments, VanEck, NYDIG, Valkyrie Digital Assets, and SkyBridge Capital. These companies are hoping to tap into the growing demand for Bitcoin exposure among institutional and retail investors, as well as to compete with the successful launch of Bitcoin ETFs in Canada and other countries. 

According to data from Bloomberg Intelligence, the first four Bitcoin ETFs in Canada have amassed over $2 billion in assets since February 2023.