Bitwise ETF Surge: Navigating Regulatory Waves

Bitwise Asset Management has recently thrown its hat into the ring, joining the cohort of companies vying for the coveted regulatory approval of a Bitcoin (BTC) Exchange Traded Fund (ETF) in the ever-evolving landscape of the United States.

In a significant development, the firm's ETF has now secured an official listing on the Depository Trust and Clearing Corporation (DTCC) with the ticker BITB, signaling a palpable sense of positivity that seems to be taking root within the industry.

Buoyed by the recent listing, Bitwise expresses confidence and positivity

The air is rife with optimism as Bitwise steps into the arena, echoing the recent moves of Fidelity, a noteworthy financial institution that celebrated the listing of its Bitcoin ETF on the DTCC just last week.

Anticipating a potential breakthrough, Matt Hougan, Chief Investment Officer at Bitwise, has unveiled the company's proactive approach, expressing readiness for a potential launch. "We're gearing up as if a launch is imminent," he affirmed, detailing ongoing preparations encompassing marketing, sales strategies, and collaborative efforts with regulatory bodies.

Hougan also shed light on discussions with regulators, emphasizing the routine nature of such engagements with the U.S. Securities and Exchange Commission (SEC) that extends to "all the firms" in the sector.

This unfolding narrative takes place against a backdrop of mounting excitement in the financial community. Bloomberg analysts have estimated a 90% chance of the SEC greenlighting a Bitcoin ETF by January 10, injecting further optimism into the atmosphere.

Adding to this upbeat outlook, Ryan Rasmussen, a senior crypto research analyst at Bitwise, envisions a promising future for Bitcoin, forecasting new all-time highs in 2024. He boldly declares that a spot Bitcoin ETF could potentially emerge as "the most successful ETF launch in history."

Meanwhile, the industry is witnessing a noteworthy shift in ETF structures aligning with the SEC's preferences

According to Bloomberg's ETF analyst, Eric Balchunas, Invesco has adjusted its approach, embracing the SEC's emphasis on in-kind creations in ETFs, as evident in its recently updated S-1 submission.

Invesco is committing to cash creates only, as per their just-updated S-1. Pretty big clue that SEC is dug in on only letting cash create ETFs out in first run (which is what we hearing back channel as well). Still, many were waiting to see if BlackRock could sway SEC on in-kind https://t.co/l4DIu9G2Wh

— Eric Balchunas (@EricBalchunas) December 13, 2023

This strategic adaptation stands in contrast to the initial resistance displayed by financial heavyweights like BlackRock, Fidelity Investments, and Ark Invest. BlackRock, in particular, has reportedly refined its spot Bitcoin ETF structure to accommodate 'authorized participants,' envisioning major Wall Street banks like Goldman Sachs and JPMorgan creating new fund shares with cash.

Pending approval, this modification aims to facilitate institutional exposure to Bitcoin without direct cryptocurrency ownership, aligning with the SEC's stringent requirements for ETF approval, emphasizing investor protection and reduced transaction costs.

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