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Gary Gensler’s political goals may explain Bitcoin ETF approval delays as window is about to slam shut

Gary Gensler’s political goals may explain Bitcoin ETF approval delays as window is about to slam shut
The SEC's window of opportunity to approve all the Bitcoin ETFs at the same time will close by November 17. Credit: JIM LO SCALZO/EPA-EFE/Shutterstock
  • The deadline for the SEC to approve all spot Bitcoin ETF applications at once is closing.
  • There are three likely scenarios for the SEC.
  • Meanwhile, Ark Invest's Cathie Wood said she has an explanation for Gensler's reticence.

Happy Wednesday!

The window for the Securities and Exchange Commission to approve, in one go, all the Bitcoin exchange-traded fund filings will close on November 17.

And Cathie Wood says she may know the reason for any delays.

Let’s dive into it.

January more likely

Cathie Wood of Ark Invest said that SEC Chair Gary Gensler’s aspirations to be Secretary of the Treasury may be a big reason for the delay in approvals of a spot Bitcoin ETF.

“There’s speculation he’s interested in the Treasury Secretary position at some point,” she told CNBC in an interview, adding that there must be “something else” that has to explain his reticence when it comes to the approvals. His ignorance of the industry is not one of them, she said.

Meanwhile, the SEC is running out of time.

The deadline for the Hashdex and Franklin Templeton Bitcoin spot ETF applications is set for November 17, while the Global X application is due on November 21.

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”There’s a pretty good chance we’ll see delay orders from the SEC,” said Bloomberg Intelligence ETF expert James Seyffart, meaning that the agency would push deadlines back to January 1 for Hashdex and Franklin Templeton, and February 29 for Global X.

Seyffart still sees a 90% chance that Bitcoin spot ETFs will get the nod before January 10.

Seyffart and Bloomberg Intelligence ETF expert Eric Balchunas previously said that November 8 to November 17 marked the first time the SEC could approve all Bitcoin spot ETF applications at once since Grayscale’s courtroom victory.

The two analysts said the SEC will likely want to avoid playing “kingmaker” by giving an unfair head start to any one product.

Seyffart outlined three possible scenarios should the SEC miss the November 17 deadline.

The first is for the SEC to greenlight a first wave of nine ETF applications — including BlackRock’s — and allow the last three applications to launch at a later date.

In the second scenario, the SEC approves 19b-4 forms for the first nine applications first, but holds back all the applications and schedules a common launch date using a different form, S-1.

Bitcoin ETF issuers must get for their 19b-4 filings from the regulator’s Trading and Markets division, while their S-1 forms need to be signed off by the division of Corporate Finance.

Seyffart wrote that the SEC could approve 19b-4 filings and still take “days, weeks, or even months” to sign off on S-1 forms.

The third scenario is for the agency to deny all applications at once.

Crypto market movers

  • Bitcoin remained stagnant over the last 24 hours, at $36,299.
  • Ethereum slumped by 0.6% in the same period, at $2,017.
  • Solana and Avalanche are up 19% and 17%, respectively.

What we’re reading

Tom Carreras is a Markets Correspondent at DL News. Got a tip? Reach out at tcarreras@dlnews