SEC Looks to Enhance Control by Trimming Intermediaries in Spot Bitcoin ETFs: Bloomberg Analyst
Bloomberg analyst Eric Balchunas has shared insights on the latest requirements imposed by the U.S. Securities and Exchange Commission (SEC) to regulate the involvement of third parties in Spot Bitcoin ETFs through a “cash-create” redemption model.
The SEC has set a deadline of December 29, 2023, for spot Bitcoin exchange-traded fund (ETF) applicants to submit the final S-1 amendment.
Confirming the date for final amendments to all S-1s by Friday the 29th. The @SECGov has told issuers that applications that are fully finished and filed by Friday will be considered in the first wave. Anyone who is not will not be considered. In addition, the filings cannot… https://t.co/syyINu1BEI
— Eleanor Terrett (@EleanorTerrett) December 24, 2023
Other deadline requirements include issuers entering into agreements with Authorized Participants (APs) and specifying the cash-create or in-kind redemption models that will be employed.
In a thread post on X, Balchunas highlighted the significance of the S-1 Amendment deadline for ETFs and the challenges tied to identifying APs for approval.
Happy S-1 Amendment Deadline Day to all (the maniacs) who celebrate.. unfort today may not tell us who is officially in the Cointucky Derby yet as most S-1s prob have blank space where AP name should go. Need those to declare horse qualified. Could see some today, but guessing… pic.twitter.com/o830GFqQvP
— Eric Balchunas (@EricBalchunas) December 29, 2023
He pointed out that the SEC not only demands APs to be named in the documents but also to serve as underwriters, guaranteeing the issuance of new ETF shares to the market.
This additional requirement raises concerns among potential APs, given the novelty of the asset class and potential legal risks.
Meanwhile,
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