U.S. asset managers remain hopeful the securities regulator will permit the trading of spot bitcoin exchange-traded funds (ETFs), even after a fake post on the agency's social media account saying they had been approved sparked confusion on Tuesday.
The Securities and Exchange Commission (SEC) will decide on Wednesday whether to approve an application from asset managers Ark Investments and 21Shares to launch a spot bitcoin ETF. More than a dozen bitcoin ETF applications, including from BlackRock, Fidelity and VanEck, are also pending with the agency.
The products would be a game-changer for bitcoin, offering institutional and retail investors exposure to the world's largest cryptocurrency without directly holding it, and a major boost for a crypto industry beset by a string of scandals.
Several industry executives told Reuters earlier this week they expected the SEC will approve the Ark/21Shares product along with many others. They declined to be identified because the discussions are private.
The SEC has not said how it will rule and a spokesperson said the agency cannot comment on applications.
Industry insiders and media outlets were caught off guard Tuesday evening when an unknown party posted on the SEC's X account that all the products had been approved, sending executives scrambling to figure out what was happening.
The SEC quickly disavowed and deleted the post, and has said the authorities are investigating the incident. X confirmed late on Tuesday that the SEC's account was compromised and said it was because of an "unidentified individual" obtaining control of a phone number associated with the agency's account through a third party.
On Tuesday evening, several of the sources said they did not expect the apparent hack to derail the process.
Issuers this week disclosed their planned ETF fees, usually one of the final details nailed down before a launch. At least three firms have filed or were preparing to file requests for SEC approval to launch their products on Thursday, said three sources.
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