List of Companies Seeking Spot Bitcoin ETF Approval

With Bitcoin receiving more hype in 2023, many are looking for more ways to provide exposure to the asset besides direct investment. There are currently some options available, such as the ProShares Bitcoin Strategy ETF. This ETF is “Bitcoin-linked”, meaning that the price closely follows that of Bitcoin. This is done through futures contracts. However it can have price tracking errors and has high administrative costs. 

Alternatively, a spot Bitcoin ETF would exactly track the price of Bitcoin. In fact, the ETF would own Bitcoins instead of Bitcoin futures. This would have several benefits for Bitcoin, as it would allow new investors to enter the space, more volume (which leads to more stable prices), better liquidity, and lower administrative costs than alternative ETFs. 

With these benefits in mind, let’s take a look at the current list of companies that are seeking regulatory approval. 

Companies Waiting for Spot Bitcoin ETF Approval

In recent years, there has been an ongoing debate about whether cryptocurrency should be considered a security. The use of indirect ownership of futures contracts was a workaround for this issue, but the proposed benefits of the spot ETF are causing the debate to heat up. This has resulted in many companies submitting prospectuses to the SEC in hopes of getting approval. Here is a list of those companies:

BlackRock

Blackrock, founded in 1988, is the largest asset management company in the world. With over $8.5 trillion in assets, the firm is well above the rest of the competition. When BlackRock applied for their Bitcoin ETF on June 15, 2023, Bitcoin rose over $5,000 over the course of a week. 

GrayScale

While BlackRock is huge in the general asset management space, GrayScale is the largest in the crypto asset management arena. GrayScale has been involved in crypto over-the-counter (OTC) products and other forms of investment for over a decade. GrayScale filed with the SEC to convert one of these OTC products (GBTC) into an ETF on the New York Stock Exchange (NYSE) in October 2023.

Fidelity 

Fidelity has many arms, ranging from financial services (planning, 401k, etc.) to investment management and brokerage services. They currently allow for direct investment into crypto through Fidelity Crypto®. However, they have also applied for a Bitcoin ETF, adding several amendments to promote user safety and risk disclosures. The most recent amendment was in October 2023.

VanEck

VanEck is a leader in the ETF and mutual fund space. They provide ETFs ranging from municipal bonds to social sentiment. They also offer a Bitcoin Strategy ETF (XBTF), which uses futures to indirectly track the price of Bitcoin. It has achieved YTD returns of over 100%. Van Eck’s proposed spot Bitcoin ETF is geared towards traditional asset managers, which may allow them to find their niche in a saturated market. 

Franklin Templeton 

Franklin Templeton is another large firm that has applied for a spot Bitcoin ETF. With over $1.5 trillion in AUM, it is one of the largest investment firms in the world. They specialize in mutual funds, bolstering over 450 for clients to choose from. The SEC recently delayed the decision on their spot Bitcoin ETF from November 2023 to early 2024.

Note - The 12 spot-bitcoin ETF applications are from Grayscale, 21Shares & Ark, BlackRock, Bitwise, VanEck, Wisdomtree, Invesco & Galaxy, Fidelity, Valkyrie, Global X, Hashdex and Franklin.

When Will Spot Bitcoin ETFs Get Approval?

Without a doubt, there is heavy demand for spot Bitcoin ETFs. Many of the indirect and futures ETFs have flaws, as mentioned above, so a spot ETF would change the market and attract tons of investors. However, the SEC is more concerned with the risks associated with such an ETF. Bitcoin still remains extremely volatile, and the SEC has to wort through the dozen or so applications.

However, many experts believe that the SEC will approve these ETFs in early 2024. More specifically, JPMorgan believes that approval will be before January 10, 2024, which is the final deadline for several applications. Additionally, these experts also believe that several, if not all ETFs will be approved simultaneously. 

How to Buy Bitcoin Before Spot ETF Approval

If you are interested in getting exposure to Bitcoin before the approval process of the spot ETFs, there are multiple ways.

The first way to gain exposure is to open an account with a crypto brokerage. On the brokerage, you can buy Bitcoin and hold direct ownership that way. Some of the top brokerages are Coinbase, WeBull, eToro, and Gemini. It is fairly simple to create an account and begin trading on these platforms. 

The other way to gain exposure to Bitcoin is through the current list of ETFs. These ETFs, such as BITO and BTF, use Bitcoin futures to closely track the price of Bitcoin. While the price movements will not be exactly the same as Bitcoin, it can still provide relatively accurate exposure.