In a recent article on CryptoSlate, it was reported that the early dismissal of BlackRock’s proposed spot Bitcoin exchange-traded fund (ETF) should not deter its eventual success. Nasdaq executive Giang Bui explained that the rejection was “purely procedural” and not an indication of the product’s viability.
BlackRock had filed an application for a spot Bitcoin ETF on June 15, with Nasdaq responsible for filing the necessary rule changes needed to list the product. However, on June 30, the U.S. Security and Exchange Commission (SEC) declared Nasdaq’s filing and others as inadequate, leading to the early rejection. Bui clarified that this rejection was due to regulatory procedural issues rather than any concerns about the substance or potential viability of the product.
Bui further highlighted that once the exchange files the necessary forms, the SEC has seven business days to review and reject it if it fails to comply with the SEC rules related to form. This early rejection is merely a procedural step and should not be seen as a definitive decision on the product’s potential success.
Following the initial rejection, Nasdaq and other companies made updates to their ETF applications, explicitly listing Coinbase as a surveillance-sharing agreement partner. Bui acknowledged that this approach was unusual but stated that it was done to strengthen the filing as much as possible.
BlackRock’s spot Bitcoin ETF is just one of several applications of its kind currently pending. Nasdaq is also handling a similar proposal from Vaklyrie Investments, while other exchanges like Cboe are processing applications from asset management firms such as Ark Invest, VanEck, WisdomTree, Invesco, and Fidelity. NYSE Arca is also handling an ETF proposal from Bitwise. Many of these proposals have similarities and include a surveillance-sharing agreement with Coinbase.
In addition, Grayscale intends to convert its existing GBTC fund into a spot Bitcoin ETF in a slightly different manner. Bui acknowledged Grayscale’s proposal and its recent legal victory, stating that Nasdaq is analyzing the implications for its filings.
The SEC recently delayed its decision on most of the spot Bitcoin ETF applications, and a decision is expected in October. It is clear that despite the early rejection, the market for Bitcoin ETFs remains active, and there is optimism surrounding their eventual approval. Investors and industry experts will eagerly await the SEC’s decision and its potential impact on the cryptocurrency market.