Officials from Bitwise and Grayscale, top crypt investment firms, are optimistic that the United States Securities and Exchange Commission (SEC) will finally approve the spot Bitcoin Exchange-Traded Fund (ETF).

Deadlines for SEC’s Decision on Bitwise and Grayscale Lapse in July 2022

“There’s a perception in the crypto industry that the SEC is just saying no, and that’s not what the facts show,” expressed Matt Hougan, the chief investment officer for Bitwise.

Grayscale, which runs the globe’s largest Bitcoin fund, the Grayscale Bitcoin Trust (GBTC), is owned by DCG, the parent firm of CoinDesk. Now, Bitwise and Grayscale face impending deadlines after making their applications for spot Bitcoin ETF. The proposal put forward by Grayscale for permission to convert GBTC to an ETF is currently under public comment phase, with the deadline for SEC coming on 6th July 2022. In the case of Bitwise, the deadline is 26th July 2022.

Hougan explained that SEC has only approved a few interval markets plus a Bitcoin futures EFT based on the 1940 Investment Act. Recently, two approved Bitcoin futures ETFs applications were approved under the 1933 Investment Act, which is the same legislation that Spot Bitcoin Futures ETFs for Bitwise and Grayscale have been filed under. 

“That’s a progression that ends in a spot bitcoin ETF,” Hougan said. “So they really are making progress, just not at the pace of the crypto community. But it’s wrong to see [the SEC] as just [holding things up],” expressed David LaVallet, the head of ETFs at Grayscale.

It was not long ago when LaValle indicated that it was no longer a matter of if but when the spot Bitcoin was going to get a nod. He further added that should the SEC reject Grayscale’s application, the company would explore all available options.

• Read also: Grayscale Unveils European ETF, Calls on the US SEC to Support GBTC Conversion to Spot BTC

The Valkyrie’s Position

According to Lori Tiernan, the Chief Strategy Officer for Valkyrie, spot Bitcoin would be approved, but the move would come in the next couple of years. 

In May, SEC approved Valkyrie’s application for Bitcoin Futures ETF, which was the second approval under the Securities Exchange Act of 1934. This approval has raised the optimism that spot BTC ETF will be approved.

In his view, Bitwise’s Hougan indicated that spot Bitcoin ETF would not grow as fast as the community was expecting. “I think the perception is that day one, a bitcoin ETF launches, and day two it has $30 billion in assets, and that’s just not the way ETFs work,” Hougan said. 

It would follow the trend demonstrated by other top ETFs, such as GLD. “GLD is the fastest-growing ETF of all time. It hit $1 billion in three days, then hit $3 billion after a year, and after five years, it hit $30 billion,” Hougan noted.

“I think the effect of a [spot bitcoin] ETF will be overhyped before it launches, and then people will dismiss it. Eventually, [an ETF] will be the largest way that investors will hold Bitcoin,” Hougan concluded.