The United States Securities and Exchange Commission (SEC) has delayed its decision on several proposals for spot Bitcoin exchange-traded funds (ETFs), including BlackRock, ahead of an anticipated government shutdown. The applications from Invesco, Bitwise, and Valkyrie were also delayed, and it is expected that applications from Fidelity, VanEck, and WisdomTree will face similar delays. These delays are due to the potential government shutdown that could occur on October 1 if Congress does not agree on funding bills. The SEC will have until mid-March at the latest to make a final decision on these ETF applications.
The delays in the decision on spot Bitcoin ETFs came two weeks earlier than the scheduled second deadline date for many applicants, who were initially expecting to hear from the SEC by mid-October. The potential government shutdown has put the short-term future of the U.S. government at risk as Congress needs to pass funding bills by October 1 to avoid a shutdown. This latest delay follows a previous delay in early September, which pushed back the first deadline for many spot Bitcoin ETF applicants. There is also a possibility that the third set of deadlines for these firms in mid-January could be delayed as well.
In late August, Bloomberg ETF analyst Eric Balchunas increased the probability of a spot Bitcoin ETF being approved by the end of 2023 to 75%, citing the unanimous decision by the U.S. Court of Appeals Circuit in Grayscale’s court win over the SEC as a reason for the increased odds. Balchunas further raised the odds to 95% by the end of 2024. Despite these delays, there is still optimism within the industry that a spot Bitcoin ETF will eventually be approved.