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The Uncertain Future of Bitcoin Spot ETFs

In a speculative and anticipatory atmosphere, the future of Bitcoin spot exchange-traded funds (ETFs) remains uncertain, with analysts like Eric Balchunas of Bloomberg suggesting a probable approval but not ruling out the need for “more time” from the Securities and Exchange Commission (SEC).

The SEC Dilemma: Approval or Wait?

While the approval of a Bitcoin spot ETF is considered highly likely, with Eric Balchunas and his colleague James Seyffart estimating a 90% chance of a favorable decision before January 10, there is still some uncertainty. If a rejection occurs this month, it would likely be due to the SEC’s desire to take more time to assess the situation, rather than a categorical opposition to the idea.

The considerable work done by the SEC and the Bitcoin ETF issuers demonstrates a deep commitment, making a last-minute total rejection unlikely.

This would be the rug pull of the decade.

Eric Balchunas regarding a last-minute rejection by the SEC

Balchunas emphasizes the significant effort put in by everyone, especially during the holiday period. The extent of the preparations suggests that even if rejected, the fight would not be over, with issuers likely to follow Grayscale’s example by engaging in legal proceedings against the regulator.

An Uncertain Future: Between Litigation and Reforms

The SEC’s decision, regardless of its outcome, is likely to trigger a range of reactions from disappointment to legal challenge. Recent public comments submitted to the SEC reflect a diversity of opinions, with some calling for a categorical rejection of Bitcoin spot ETFs for various reasons, including concerns about the decentralized nature of Bitcoin and its potential to bypass traditional financial channels.

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