Bitcoin ETF Race Intensifies as WisdomTree and Invesco Both File Submissions Within 24 Hours Joining BlackRock
The competition to launch a spot Bitcoin exchange-traded fund (ETF) in the US has intensified, with Invesco and WisdomTree filing submissions with the Securities and Exchange Commission for their own Bitcoin ETFs.
On Tuesday, WisdomTree filed for the WisdomTree Bitcoin Trust, requesting the SEC to allow it to list its fund on the Cboe BZX Exchange under the ticker “BTCW.”
The asset management firm, with $83 billion in assets under management (AUM), has previously applied for a spot Bitcoin ETF twice.
Its first application was rejected by the SEC in December 2021. Its second application was rejected once again in October 2022, with the financial regulator citing similar concerns of fraud and market manipulation.
To address these concerns, Cboe has entered into a "surveillance-sharing" agreement with a spot Bitcoin (BTC) platform.
Likewise, Invesco submitted its application for the Invesco Galaxy Bitcoin ETF hours after the filing by WisdomTree.
In its 19b-4 document, which informs the SEC of a proposed rule change, Invesco requested that the financial regulator allow its “Invesco Galaxy Bitcoin ETF” product to be listed on the Cboe BZX exchange.
The filing notes that a spot Bitcoin ETF which uses “professional custodians and other service providers,” removes the need for investors to rely on “loosely regulated offshore vehicles” in turn, allowing for investors to more readily “protect their principal investments in Bitcoin.”
The moves follow BlackRock's surprise submission for a spot Bitcoin ETF on June 15.
The SEC has presently authorized only Bitcoin ETFs tied to US-traded futures.
The commission has consistently cited inadequate cross-exchange market surveillance as one reason why it has not yet approved a Bitcoin spot ETF.
However, Invesco contended in its filing that the U.S. is an exception among major markets that do not have a vehicle for spot exposure. Many countries, including Canada and Brazil, allow investors to use traditional exchange-listed and traded products to gain exposure to Bitcoin.
Hopes Around GrayScale's GBTC Being Converted into ETF Revives
The ETF filing by BlackRock has also restored hope in Grayscale Bitcoin Trust (GBTC), converting its fund into an ETF.
In fact, this has prompted GBTC shares to reach over $16 on Tuesday, gaining 11.44% before the end of the trading day, according to data from Yahoo Finance. This marks the first time the fund has hit this level since May 10.
Analysts believe the surge in GBTC shares was influenced by investors who are optimistic about the possibility of the fund being converted into an ETF amid Grayscale’s ongoing lawsuit against the SEC.
“Many are taking BlackRock’s conviction as a sign that they expect Grayscale to win its case against the SEC, and want to be in with an ETF filing should that happen,” macro analyst Noelle Acheson reportedly said in a note.
Grayscale first submitted an application to convert GBTC into an ETF in 2016.
In June 2022, after the SEC declined the ETF application, Grayscale filed a petition with the US Court of Appeals for the District of Columbia Circuit to challenge the decision.