ARK Investment Management and 21Shares have submitted another amendment to the SEC for their ARK 21Shares spot Bitcoin ETF proposal. This is the third amendment since April, with the latest amendment addressing transparency, security, and accounting standards. The SEC has postponed its decision until January 11, 2024. Analysts believe that despite previous rejections, approval for a spot Bitcoin ETF is likely.
Our analysis of the situation
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In a surprising yet promising move, ARK Investment Management has filed yet another amendment with the US Securities and Exchange Commission (SEC) for its eagerly anticipated ARK 21Shares spot Bitcoin ETF proposal. It seems that the third time's the charm, as ARK Investment Management and European crypto asset manager 21Shares tinker with their application in pursuit of SEC approval.
Led by the formidable Cathie Wood, a renowned Bitcoin bull, ARK Investment Management has been determined to break new ground in the world of exchange-traded funds. Their commitment to transparency and security has prompted them to amend their prospectus for the third time since its initial submission in April.
The October amendment saw crucial updates, including the separation of assets, clarifying that they would be held in distinct accounts, isolated from both client and corporate assets. ARK Invest made these changes in an effort to showcase their dedication to transparency and safety. Additionally, the adjustment addressed the net asset value calculations, aligning them with the Generally Accepted Accounting Principles (GAAP) endorsed by the SEC.
However, the SEC delayed its decision and required more time for consideration, extending the deadline for another 60 days until January 11. This unexpected extension has kept everyone on their toes, eagerly awaiting the Commission's verdict on the ARK 21Shares spot Bitcoin ETF.
Bloomberg senior ETF analyst Eric Balchunas has expressed both surprise and optimism regarding the latest amendment. He believes that the multiple updates signify a deliberate effort to fine-tune the proposal, making it more appeasing to the SEC's requirements. Balchunas highlights the inclusion of a fee, which has sparked some discussions within the community about its appropriateness. Moreover, the amendment introduces new risk disclosures and demonstrates ongoing conversations between ARK Investment Management and the SEC.
It's worth noting that the SEC has never approved a spot Bitcoin ETF, rejecting previous applications dating back to 2013. Concerns over fraud and market manipulation have been the key stumbling blocks thus far. However, recent applications have taken these concerns to heart, incorporating surveillance-sharing agreements (SSA) to foster transparency and combat manipulation. The addition of an SSA by the Cboe BZX Exchange to the ARK 21Shares proposal, following BlackRock's lead, further solidifies the industry's dedication to addressing these concerns head-on.
While the path to approval may still have twists and turns, industry analysts remain optimistic that a spot Bitcoin ETF is within reach. The sentiment is overwhelmingly positive, with market observers, including JPMorgan Chase & Co, believing that SEC approval is only a matter of time. However, any unexpected rejection could potentially lead to legal actions against the agency, highlighting the immense excitement and anticipation surrounding this groundbreaking ETF proposal.
The clock is ticking as the final deadline for the ARK 21Shares Bitcoin ETF approaches on January 10, 2024. With giants like BlackRock expressing confidence in approval, all eyes are on the SEC to see if the third time will indeed be the charm for ARK Investment and 21Shares.
Disclaimer: Our articles are NOT financial advice, and we are not financial advisors. Your investments are your own responsibility. Please do your own research and seek advice from a licensed financial advisor beforehand if needed.
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