Does Bitcoin ETF get an approval?

Cryptocurrency 

Bitcoin and other cryptocurrency investments have climbed in the past few months, mostly for one big reason: anticipation of spot bitcoin ETFs. And the eagerly awaited launch is almost here.

Regulatory approval of spot bitcoin ETFs is likely in the next few days. A spot Bitcoin ETF would directly hold Bitcoin assets. In contrast, Pro Shares Bitcoin Strategy ETF, the first U.S. bitcoin-linked ETF, invests in futures contracts.

 Spot bitcoin ETFs are expected to create new and bigger opportunities for institutions to invest in cryptocurrencies and other digital assets.

But while some crypto enthusiasts tout bitcoin ETFs as a major tailwind for digital assets in 2024, others say regulatory approval could become a sell-the-news event in the short run.

Bitcoin spiked to 20-month highs above $45,000 to start 2024 and traded above $44,000.

 

How Bitcoin ETFs Will Drive Institutional Demand

Thirteen spot bitcoin exchange-traded fund applications await approval from the Securities and Exchange Commission. They include applications by BlackRock, ARK Invest, Grayscale Investments, WisdomTree, VanEck, Valkyrie, Invesco and Fidelity.

The window for the SEC to approve ETF applications opens on Friday, Jan. 5 through Jan. 10, Bloomberg Intelligence ETF analyst James Seyffart. Those dates correspond to deadlines for an application filed by Cathie Woods' ARK Invest, according to Forbes.

Seyffart expects approvals between Jan. 8 and Jan. 10. He sees a 10% chance or less that the SEC will decline to approve filings by Jan. 10. The SEC could technically issue approval orders on at least nine applications before the window, Seyffart posted.

Bitcoin Halving: The Next Milestone

But spot bitcoin ETF approval isn't the only driving factor for bitcoin in 2024. The next halving event is expected around April. Halving events help control the finite supply of 21 million bitcoins by cutting in half the amount of crypto rewards doled out to miners.

The last bitcoin halving event occurred in May 2020, when mining rewards fell to 6.25 bitcoin per block mined from 12.5 bitcoin per block. Some refer to the events as halvings, a portmanteau of "halving" and "happening."

Halving events occur after every 210,000 bitcoins are mined, which takes roughly four years. The price of bitcoin has historically risen in the months after halving events as the creation of new bitcoins slows.

 

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