Ex-SEC Chair Predicts Inevitable Approval of Spot Bitcoin ETF Despite Ongoing Delays

In the wake of the United States Securities and Exchange Commission (SEC) opting to postpone decisions regarding several spot Bitcoin exchange-traded funds (ETFs), Jay Clayton, the former chair of the commission, expressed his unwavering belief that approval for such funds was an inevitable outcome, despite the ongoing delays.

In a candid interview with CNBC on September 1st, Clayton articulated his perspective, emphasizing the seismic shift represented by major financial institutions endorsing spot Bitcoin investment vehicles. On August 31st, the SEC extended the review period for applications seeking approval for spot Bitcoin exchange-traded funds (ETFs) from a consortium of industry giants, including BlackRock, WisdomTree, VanEck, Invesco Galaxy, Bitwise, Valkyrie, and Fidelity.

The commission has afforded itself an additional 45-day window, commencing upon the notice’s publication in the Federal Register, to either greenlight, reject, or further delay the ETF applications submitted by these seven influential firms. Clayton expressed optimism, stating his expectation of “progress on this going forward.” It’s pertinent to note that the SEC retains the authority to extend the application deadlines until March 2024.

Clayton’s assertion mirrored the sentiment articulated by U.S. Court of Appeals Circuit Judge Neomi Rao. Judge Rao, alongside two fellow judges, had previously mandated the SEC to reevaluate the application submitted by asset manager Grayscale, aiming to convert its Bitcoin Trust (GBTC) into a spot Bitcoin ETF. Judge Rao underscored that the SEC had already given the green light to Bitcoin futures ETFs and argued that Grayscale’s proposal bore “material similarity” to these previously approved products.

The flurry of ETF application delays occurred in rapid succession on August 31st, just ahead of the Labor Day weekend in the United States. The forthcoming deadline for the review of significant spot Bitcoin ETF applications falls on October 7th, when the commission is expected to provide an update on the offering from fund manager Global X.

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