The second-ever Bitcoin futures ETF was approved by the United States Securities and Exchange Commission (SEC) on May 6th, 2022. The SEC has officially approved Valkyrie's Bitcoin futures ETF following up on Teucrium’s Bitcoin futures ETF approval last month.
The SEC has approved futures ETFs in the past, and those following the most recent news of the digital world are waiting for the SEC to approve a Bitcoin spot ETF. The application process for approval must be filed under the Securities Exchange Act of 1934, specifically using a 19b-4 form. Spot ETFs must also use that same form to apply for approval, but so far a Bitcoin-backed ETF has yet to be approved. However, the approval of Teucrium’s Bitcoin futures ETF showcases the start of a new influx of these new investment vehicles.
The initial application for Valkyrie’s Bitcoin futures ETF was filed in August 2021 and its approval follows a growing trend of Bitcoin ETFs as countries including Canada, Brazil, Europe, and Dubai approve their own versions. More countries are in the process of approving Bitcoin futures ETFs in 2022.
While several Bitcoin futures ETFs have been approved, spot-based ETFs have been struggling for recognition. However, there is considerable support for Bitcoin spot ETFs and many are waiting for their approval. NASDAQ conducted a poll asking about the possible implications for such an investment product. The response indicated that with the introduction of spot ETFs, Bitcoin and cryptocurrencies may become a more common investment and even recommended by many more financial advisors.
It is estimated that a spot ETF could receive approval from the SEC by mid-2023. This is in accordance with the opinions of two Bloomberg analysts: Eric Balchunas and James Seyffart. The prediction heavily relies on whether or not the definition of the term “exchange” will be adjusted with the implementation of a new amendment. From the financial advisors who were included in the poll, they do not share the same sentiment where only 38% agree and 31% disagree.