The potential approval of a spot Bitcoin Exchange-Traded Fund (ETF) by the U.S. Securities and Exchange Commission (SEC) might face delays due to a procedural clause. Fox Reporter Eleanor Terrett recently brought attention to this clause, revealing its possible impact on the ETF’s approval process.
Terrett’s insights, shared in a January 9th tweet, point out that the SEC’s procedural clause, 17 C.F.R. Section 201.431, allows any of the five SEC commissioners to request a full Commission review of matters previously approved by staff. This clause could potentially slow down the approval of the highly anticipated spot Bitcoin ETF.
The current SEC commissioners are Gensler, Crenshaw, Peirce, Lizárraga, and Uyeda. Terrett’s revelation came in response to a tweet by Anne Kelley, who highlighted the power of this specific SEC clause. It serves as a tool for enhancing transparency in the SEC’s decision-making process, especially for non-chair commissioners.
Adding to the discussion, Bloomberg’s senior ETF analyst Eric Balchunas commented on Terrett’s tweet. He expressed trust in the approval process under SEC Chair Gensler’s leadership, suggesting that the staff’s thorough work with issuers indicates a plan for approval.
Furthermore, Justin Slaughter, policy director at Paradigm, pointed out the SEC’s ability to vote on matters through the “seriatim” process without holding a formal meeting. Anne Kelly also tweeted about the potential for this clause to prolong the approval process and speculated on whether a commissioner might request a complete commission vote.
On January 2, Terrett had previously expressed doubts about an immediate approval of the spot Bitcoin ETF, citing vacations and a backlog of work at the SEC. She drew parallels with the timeline for the Ethereum futures approval in October 2023, suggesting that the Bitcoin ETF approval might extend beyond the immediate deadline.
Terrett also mentioned meetings between the SEC and major exchanges like Nasdaq, CBOE, and NYSE regarding the spot Bitcoin ETF applications. These meetings aim to address application deficiencies, edging them closer to approval. However, with the January 10 deadline nearing, the final decision of the SEC remains uncertain.