June 16, 2024

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Invesco resubmits bid for Bitcoin (BTC) ETF following in BlackRock’s footsteps

Invesco resubmits bid for Bitcoin (BTC) ETF following in BlackRock’s footsteps

Investment management firm Invesco (IVZ), which has $1.4 trillion in assets under management, has re-applied for a Bitcoin (BTC) Spot ETF (ETF).

In 2021, Invesco first applied for a Bitcoin ETF jointly with Galaxy Digital. It also applied for a bitcoin futures ETF, but abandoned the effort in October 2021 after a ProShares futures ETF was approved and started trading first.

Invesco argued in its filing that the lack of a Bitcoin ETF is pushing investors toward riskier alternatives, as seen in bankruptcies such as FTX, Celsius Network, BlockFi, and Voyager Digital Holdings.

Invesco has also stressed the need for investor protection, saying approval of such a type of bitcoin ETF is based on a watch-sharing agreement with a large regulated market, not on regulation of the bitcoin spot market itself.

Surveillance sharing agreements facilitate the sharing of information regarding market trading activity, clearing operations, and customer identification, which greatly reduces the possibility of market manipulation—something the SEC cares deeply about.

“The SEC is very interested in market manipulation in relation to bitcoin prices, and has cited this in almost, if not all, previous rejections,” Graeme Moore, head of tokens at Polymesh Association, previously told CoinDesk. This is because the SEC’s view is that Coinbase and others are not regulated as exchanges and therefore cannot be trusted “to prevent fraudulent and manipulative business and practices.”

So far, the SEC has not provided any indication of when it plans to make an announcement regarding a bitcoin ETF.

Grayscale (which currently shares co-ownership with CoinDesk in the Digital Currency Group) has been suing the Securities and Exchange Commission (SEC) over its rejected bitcoin ETF. Speaking at the CoinDesk Consensus Conference in Austin, GrayScale CEO Michael Sonnenstein said he expects a decision on the case by September.

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