Market Experts Divided on BlackRock's Application to Approve a Bitcoin Spot ETF: Will It Be Accepted or Rejected?

Market Experts Divided on BlackRock's Application to Approve a Bitcoin Spot ETF: Will It Be Accepted or Rejected?

Market Experts Comment on BlackRock's Application to Approve a Bitcoin Spot ETF; opinions differ.

After trillion-dollar asset manager Blackrock submitted a Bitcoin Spot ETF application to the SEC for approval, the crypto industry has apparently found a new ongoing topic. The old one, the SEC/Ripple conflict, was lost due to a court ruling last week. But one can also hope with the new topic that it won't be over very quickly, because the SEC has a maximum period of 240 days within which it has to decide on the ETF application - at least eight months.

Many prominent figures are not convinced that the spot ETF will be approved. They highlight the many obstacles put in place by regulators to increase the difficulty of the crypto spot ETF approval process.

In an interview with Coindesk, experts spoke about what the market should expect from the US Securities and Exchange Commission regarding the recent Bitcoin spot ETF applications.

In an interview with Coindesk, Matt Hougan, Chief Investment Officer (CIO) at Bitwise Asset Management, was quite positive. BlackRock is too valuable a company for the SEC or any other regulator to quickly reject such an application. The market needs to listen, says Hougan.

Bitwise's CIO is not exaggerating when he highlights the importance of BlackRock, currently the largest asset manager in the world with more than $10 trillion in assets under management.

Furthermore, Bernstein, a leading brokerage firm, added that the SEC’s position on a spot Bitcoin ETF cannot be sustained for much longer. So the probability that it will be approved is quite high.

Why BlackRock's application could be rejected

Meanwhile, other experts such as Octavio Marenzi, CEO and co-founder of Opimas, remain convinced that the ETF application will not be successful. As Marenzi claimed, the SEC has already identified a major loophole in BlackRock's application:

“They have identified a custodian for the assets that the SEC itself has said is operating illegally… I don’t quite understand how BlackRock can do this.”

On the other hand, Chief Investment Officer Stuart Barton, who was involved in the filing of Volatility Shares' 2x Bitcoin Strategy ETF (BITX), which was launched as the first leveraged crypto ETF in the US, spoke about the delay in approval of Bitcoin spot ETFs. Stuart Barton claimed;

"The reason for the delay is that crypto exchanges are unregulated and it takes a long time to get an exchange regulated. This is a multi-year process. This is a step before we get an ETF approval. At the moment there is no exchange that trades Bitcoin that is regulated."

Despite the mixed feelings, BlackRock CEO Larry Fink has reiterated that BlackRock is willing to work with regulators and hopes its application will be approved.