Bitcoin Spot ETF Approval by US SEC Sees Odds Rise to 65%, Bloomberg Reports

• SEC Chair Gary Gensler has toned down on the topic of crypto regulations amid increased political pressure from Congress.
• The analysts argue that the SEC’s seeming approval of Coinbase as a crypto trading platform increases the odds of a Bitcoin ETF soon.

The recent spot Bitcoin ETF frenzy has undeniably awakened the hope for approval in the United States amid increased demand from institutional investors. According to a recent study conducted by on-chain intelligence platform Santiment, about 15.87k Bitcoin addresses that hold more than 100 BTCs have accumulated approximately 11.5 million coins, which accounts for over 59 percent of the circulating supply. Interestingly, the said Bitcoin whales added about 27.75 coins in the past 12 weeks despite the recent market uncertainty. 

The increased demand for digital assets by institutional investors is ostensibly even larger as more investment fund managers seek Bitcoin ETF. Just to name a few, BlackRock, Fidelity, WisdomTree, and Valkyrie have already filed with the SEC for a spot in Bitcoin ETF.

Bloomberg Analysts Raise Expectations for a Spot Bitcoin EFT by EOY

According to Bloomberg Intelligence analysts led by James Seyffart and Eric Balchunas, the odds of the SEC approving a spot Bitcoin ETF before the end of this year have increased by 15 percent. Notably, the analysts had previously issued a forecast of 50 percent for the SEC to approve a spot Bitcoin ETF by EOY, but circumstances have changed and so is their estimate of 65 percent.

The analysts further argued that the BlackRock ETF is likely to be approved, which has included Coinbase as the surveillance-sharing agreement partner. The $9 trillion investment fund manager has had a significantly high strike rate for an ETF approval since its inception, thus making its request a possible success. Moreover, the SEC does not want institutional investors or retail investors tapping on crypto firms like FTX and Alameda Research which were largely unregulated.

In a recent interview with Bloomberg, SEC Chair Gensler downplayed his role at the agency when asked about matters relating to crypto. Notably, Gensler referred to the fact that the agency has four other commissioners in the decision-making.

“The deflection seemed a change in the way he normally handles these topics,”

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The analyst highlighted and further pointed out that while there are five members, the chair has far more control and it would be unusual if the two other Democratic commissioners were to make a different decision.

“We believe this may be a signal that aspects of the anti-crypto stance are becoming politically untenable for Gensler.”

The analyst also argued that there is a high chance of a spot Bitcoin ETF soon as the SEC approves Coinbase as a crypto trading firm. 

“This solidifies our view that if the SEC is going to bend anywhere on crypto ETFs, it will be with regard to bitcoin ETFs,” the analyst noted.

Meanwhile, the SEC has a few days left to either approve, deny or delay some Bitcoin ETF applications filed by Cathie Wood-backed Ark Invest among others.

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