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U.S. Securities and Exchange Commission Delays Decision on Bitcoin ETFs Amid Government Shutdown Uncertainty

The U.S. Securities and Exchange Commission has announced a delay in its decision on several proposals for spot Bitcoin exchange-traded funds (ETFs), including BlackRock, as a government shutdown looms.

The U.S. Securities and Exchange Commission (SEC) has postponed its decision on several proposals for spot Bitcoin exchange-traded funds (ETFs), including BlackRock, ahead of an anticipated government shutdown. The SEC also delayed the spot Bitcoin ETF applications of Invesco, Bitwise, and Valkyrie, according to separate filings on September 28. Bloomberg ETF analyst James Seyffart anticipates further delays for the applications from Fidelity, VanEck, and WisdomTree due to the looming government shutdown.

Seyffart’s expectations are rooted in the potential U.S. government “shutdown” set for October 1. Both chambers of Congress, the House and Senate, have not reached agreement on various funding bills, jeopardizing the short-term future of the U.S. government. To avoid a shutdown, Congress must pass 12 separate full-year funding bills by October 1.

These delays come ahead of the previously scheduled second deadline for many applicants, who were initially expecting responses from the securities regulator between October 16 and 19. The third set of deadlines for these firms falls around mid-January, but they too may face delays. The SEC must make a final decision no later than mid-March.

In late August, Bloomberg ETF analyst Eric Balchunas estimated a 75% probability of a spot Bitcoin ETF approval by the end of 2023, up from a prior estimate of 65%. Balchunas cited the U.S. Court of Appeals Circuit’s swift and unanimous decision in Grayscale’s victory over the SEC as a key factor behind this increased likelihood. Balchunas further raised the odds to 95% by the end of 2024.

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