The race to launch a Bitcoin ETF reached a bureaucratic crescendo Friday as some of the biggest Wall Street firms finalized their offerings’ paperwork ahead of widely expected, possibly imminent, action from the SEC.
Invesco, Fidelity and BlackRock, as well as crypto-focused firms Valkyrie and Bitwise, revealed key details including which companies they would partner with, as well as fees their Bitcoin ETFs would charge if approved. Their so-called S-1 filings are now “ready to party” as Bloomberg ETF analyst Eric Balchunas said on X.
The party could start in a matter of days. ETF watchers expect the SEC to drop its years-long stonewalling of a spot Bitcoin ETF in early 2024. Over a dozen firms are hoping to break into the new market by selling their own version of the easily investable product to investors who’d rather keep their bitcoin exposure in their brokerage accounts, alongside stocks and bonds.
Friday’s filing rush suggests the firms aren’t willing to take any chances on timing. Bloomberg analysts have said the SEC is likely to approve multiple issuers at once, so as to avoid picking favorites. Thus, the eager issuers are getting all the ducks in a row so that they can be in the first group.
BlackRock set off the end of week filing frenzy by declaring JPMorgan and Jane Street its Authorized Participants, which are partnering companies that handle financial backends related to an ETF. Within hours the others followed.
With little to differentiate one bitcoin ETF from the next, the fight could come down to fees. Invesco and its partner Galaxy Digital disclosed they’ll waive fees for the first six months and $5 billion invested, according to Balchunas. That undercut Fidelity, which plans to charge 39 basis points.
But size also matters. Bitwise revealed it’s already lined up $200 million in seed capital for its ETF, edging out BlackRock, which has $10 million at the ready. Investors could also choose one fund over the next simply because of its popularity out of the gate.
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