In a surprising move, Cathie Wood’s Ark Invest has made its third amendment to the Bitcoin ETF filing, bringing about significant improvements that have piqued the financial community’s interest.
Details of Ark Invest’s 3rd Amendment
Bloomberg’s ETF expert, Eric Balchunas, revealed the startling news, describing it as a positive step forward in the Securities and Exchange Commission (SEC) clearance process.
One notable aspect that caught the attention of analysts and investors alike was the disclosure of a fee for the proposed ETF. Balchunas revealed that ARKB would charge 80 basis points (bps), marking Ark Invest as the first issuer to disclose such a fee. This move is significant as it adds a layer of transparency to the investment product, aligning with the growing demand for clear and explicit fee structures in the ETF space.
Digging into the details of the amendment, Balchunas highlighted several updates, focusing on new risk disclosures. He suggested that these additions were likely to address specific concerns raised by the SEC’s Division of Corporation Finance (Corp Fin).
Intriguingly, the filing maintains a commitment to in-kind creations and redemptions, albeit in a hybrid model. This decision is a strategic move to minimize tax implications and address potential spread issues.
Balchunas explained, “Some are coming at me with how I must have ‘heard wrong’ re SEC advising issuers to do cash creations. I heard correctly, but some issuers are going to try and push back and ‘sell’ the SEC on in-kind given the obvious benefits for investors. We’ll see how this plays out.”
SEC Delays and Impact on Spot Bitcoin ETF Approvals
In an earlier report, Bloomberg’s James Seyffart shared insights into the SEC’s decision to delay approvals for spot Bitcoin ETFs, citing comments by the SEC’s Trading and Markets division. He explained that the delays are not unexpected and are generally considered a positive sign, indicating thorough consideration by the regulatory body.
The SEC’s request for cash creates could potentially impact broker-dealers, but Balchunas expressed optimism about the overall efficiency of this approach.
The delay in decisions on spot Bitcoin ETFs, including those from Franklin Templeton and Global X, raises speculation within the crypto space. Seyffart suggested that the comment period initiated by the SEC would likely last at least 35 days, pushing the timeline for a final decision further into the future.
In all, the odds of a spot Bitcoin ETF approval presented by the Bloomberg analysts remain at 90%.
