Countdown Begins for Spot Bitcoin ETF Approval as Critical Fed Decision Approaches
On Friday, January 5, 2024, exchanges, investment management firms, and the U.S. Securities and Exchange Commission (SEC) began discussions regarding the latest wording changes regarding Spot Bitcoin Exchange-Traded Funds (ETFs) applications. According to a report by Reuters, sources familiar with the matter state that this development could pave the way for the United States to approve Spot Bitcoin ETFs as early as next week.
Spot Bitcoin ETF Approval Date
During these discussions, issuers met with SEC officials regarding the S-1 prospectus documents required for Spot Bitcoin ETF approval. Representatives of five firms, including executives who chose to remain anonymous due to ongoing confidentiality, revealed that many issuers expect to receive final approval of their S-1 filings late Tuesday or Wednesday.
The SEC requested several changes to the filings, labeled by three issues as “minor” changes. However, the agency did not comment on individual applications, according to a spokesperson. Some asset managers are expected to amend their applications by 8 a.m. ET on Monday, January 8.
These changes will reveal details such as fees or names of market makers for Bitcoin ETFs. Additionally, as sources indicate, the information could be made public on the same day.
Recently, regulators collaborated with exchanges to finalize 19b-4 filings, outlining the rule changes necessary for spot Bitcoin ETF launches to be approved by the SEC. On Friday, exchanges submitted revisions to 11 of those filings. People familiar with the process suggest that issuers that meet year-end revision filing deadlines could receive approval to launch by Jan. 10, which is the critical date for the SEC’s decision on the Ark 21Shares ETF and is first in line.
Also Read: Is Satoshi Nakamoto Back? Bitcoin Exceeding 1 Million Dollars Was Moved to Satoshi’s Wallet
Spot Bitcoin ETF approval deadlines include:
- January 10 For Ark Invest and 21Shares.
- 14-15 March For BlackRock, Fidelity, VanEck, Bitwise, Wisdomtree and Invesco & Galaxy.
- March 19 For Valkyrie.
- 19 April For global X.
- May 30 For Hashdex and Franklin Templeton Investments.
- 8 August For pando.
- The deadline for Grayscale’s bid has passed and the organization is in direct talks with the SEC.
The U.S. Bureau of Labor Statistics will release the December 2023 CPI Report at 8:30 a.m. ET on January 11, 2024. According to the Cleveland Fed’s current forecast data, headline CPI is estimated to increase by 0.3% monthly. Although this forecast indicates an increase compared to October and November, it is consistent with the general downward trend in inflation.
This means the annualized rate exceeds 4% compared to the Fed’s 2% target; The central bank will not over analyze a single monthly CPI report. However, a relatively high December reading could somewhat delay expected rate cuts in 2024, especially if the market anticipates a cut in March.
Then, the PPI report will be published on January 12. In November 2023, PPI increased by 0.9%, driven by a 1.5% decrease in prices of final demand goods. With next week’s results, investors are turning their attention to the Federal Committee’s meeting on January 31.
Minutes of the last December monetary policy meeting show that the Fed is increasingly comfortable with controlled inflation. Also taking into account that interest rates are likely at their peak for this cycle. Conversely, if CPI or PPI reports indicate an unprecedented increase, Fed officials may recommend an interest rate increase.
The increase in Fed interest rates encourages institutional and individual investors to turn to safer assets. This could be a disadvantage for the crypto market as digital currencies are highly volatile and cannot provide a sense of security. Previously, the crypto market experienced a massive crash after three consecutive Fed rate hikes in 2021 and 2022.
Also Read: Bitcoin ETF: Crypto Community Bounces Back As Better Markets Defy Confirmations
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