Bitwise’s Matt Hougan says that while the asset manager’s application to offer the first US spot Bitcoin ETF is up for consideration this week, it may be better for the SEC to approve all the pending proposals at once.
(Bloomberg) — Bitwise’s Matt Hougan says that while the asset manager’s application to offer the first US spot Bitcoin ETF is up for consideration this week, it may be better for the SEC to approve all the pending proposals at once.
“If you look back at the history of the SEC’s treatment of ETFs, you can see examples of each, and so we have no idea what their plans are,” Hougan, the firm’s chief investment officer, said on Bloomberg Television, about how the race might play out. “I will say on behalf of investors, the best outcome is likely to line up multiple ETFs and allow them to launch at once.”
Hougan added that such a scenario would “create the most competition, the lowest prices, the best products, and be the fairest probably to the asset managers who have worked so hard over 10 years to get a spot-Bitcoin ETF approved.” Others have made similar arguments, with Cathie Wood, whose company is also trying to launch a Bitcoin ETF, telling Bloomberg TV that she expects the SEC to “approve more than one at once.”
A number of issuers currently have applications out for spot-Bitcoin ETFs, and a win by Grayscale Investments LLC against the Securities and Exchange Commission earlier this week in its fight to convert its Bitcoin trust to an exchange-traded fund is spurring optimism that one could soon launch in the US.
Many in the crypto community — and fans outside of it — have been longing for a spot-Bitcoin ETF for years. They argue that it would not only make investing in Bitcoin more accessible to everyday investors, but that it would also help bring digital assets closer to traditional financial markets.
Bitwise’s application must be addressed by the end of Friday. The SEC can delay, deny or approve applications. Most analysts expect the agency to once again delay on making a decision — on Bitwise’s application, as well as on a few others — before ultimately coming to a conclusion on whether to allow a physically backed Bitcoin ETF for US investors. ETFs that hold Bitcoin futures were approved in 2021.
The next key date, after this week, could come in mid-October, Hougan said. “If I were an investor looking ahead, I’d circle October 16th as the next big deadline to watch.”
Read more: Bitcoin ETF Deadlines Loom for SEC Ahead of Labor-Day Weekend
San Francisco-based Bitwise is known for its crypto products suite, with some analysts arguing that it could potentially stand out in the Bitcoin-ETF race thanks to its pure crypto focus. It launched its first crypto index fund in 2017, and currently offers 18 products that include ETFs, publicly traded trusts, private funds and more, according to its website. Its lineup gives investors exposure to more than 30 different digital assets.
Still, a Bitcoin ETF for American investors isn’t yet guaranteed. Regulators have consistently cited fraud and manipulation as some of the reasons not to approve such a product. Gemini, founded by brothers Tyler and Cameron Winklevoss, was the first firm to try for a physically backed Bitcoin ETF with a 2013 filing. It was rejected by the SEC.
But a Bitcoin ETF suggests crypto going from a niche asset to a mainstream one, said Hougan.
“My expectation is about what we’re seeing today — I think people are likely to overestimate the short-term impact of an ETF and underestimate the long-term impact of an ETF,” he said. “People want this to be a one-day story, it’s fun to follow the race. But this is actually a 10-year story. This is about Bitcoin moving from the edge of the investment community to the center of the mainstream allocation space.”
–With assistance from Katie Greifeld.
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