Former SEC chair states spot Bitcoin ETF approval is inevitable despite delays

The United States Securities and Exchange Commission (SEC) has been delaying decisions on multiple spot Bitcoin exchange-traded funds (ETFs), but former SEC chair Jay Clayton remains optimistic that approval is on the horizon.

In an interview with CNBC on September 1, Clayton expressed his belief that approval for spot Bitcoin investment vehicles is inevitable. He pointed to major financial institutions backing these ETFs as a significant shift in how retail investors can gain exposure to cryptocurrencies. The SEC recently extended the review period for spot BTC ETF applications from BlackRock, WisdomTree, VanEck, Invesco Galaxy, Bitwise, Valkyrie, and Fidelity.

According to the SEC’s timeline, the commission has an additional 45 days from the publication of the notice in the Federal Register to either approve, deny, or further delay the ETF applications submitted by these major firms. Clayton expects to see “progress on this going forward.” The SEC retains the option to extend the application deadlines until March 2024.

Clayton’s argument aligns with that of U.S. Court of Appeals Circuit Judge Neomi Rao. She, along with two other judges, ordered the SEC to review asset manager Grayscale’s application to convert its Bitcoin Trust (GBTC) into a spot Bitcoin ETF. Rao emphasized that the SEC had already approved Bitcoin futures ETFs and suggested that Grayscale’s proposal was “materially similar.”

These delays in ETF applications occurred in quick succession just before the Labor Day holiday weekend in the United States. The next deadline for major spot BTC applications currently under review is October 7, with expectations for an announcement about the offering from fund manager Global X. Despite the delays, Clayton remains confident that the distinction between futures and cash products cannot persist indefinitely.