As the crypto community eagerly anticipates the decision on a spot Bitcoin exchange-traded fund (ETF), Bloomberg ETF analyst Eric Balchunas shares his insights on the likelihood of approval. Balchunas believes there is a 90% chance of approval by January 10, suggesting that any potential denial by the Securities and Exchange Commission (SEC) would likely stem from a request for more time rather than an outright rejection.
Maintaining an optimistic stance, Balchunas, along with ETF analyst James Seyffart, acknowledges the possibility that the SEC might ask for an extension. They highlight that a complete denial seems unlikely considering the significant efforts invested by both the SEC and Bitcoin ETF issuers.
Balchunas points out the extensive work done over the holidays, describing an outright denial at this stage as “the rug pull of the decade.” He argues that the collaborative efforts of all parties involved in the Bitcoin ETF approval process make a last-minute rejection less reasonable.
Emphasizing the dedication shown by various stakeholders, Balchunas suggests that a definitive denial would be a surprising and unprecedented move. In the event of an unexpected rejection, he speculates that fund issuers might follow Grayscale’s lead and initiate legal action against the SEC, given the significant financial investments and compliance efforts dedicated to the approval process.
Balchunas anticipates potential legal battles, stating, “I don’t even think there will be a cooling-off period this time. I think it would be hell.” Public comments on the Bitcoin ETF continue to flow, reflecting the growing expectation and interest surrounding the regulatory decision. Some recent letters call for a clear rejection of the proposed ETFs, while the SEC’s request for feedback is met with ongoing submissions.
The latest letter submitted to the SEC raises concerns about Bitcoin’s decentralized nature, suggesting it could be exploited by authoritarian regimes seeking to evade sanctions and exert control over citizens. These concerns add another layer of complexity to the regulatory discourse, underscoring the importance of regulatory clarity in shaping the future of crypto investment vehicles as the community awaits the SEC’s decision.