The upcoming decision by the U.S. Securities and Exchange Commission (SEC) on a spot Bitcoin ETF has spurred speculation that the regulatory body might opt for approval without a public vote, as reported by Blockworks. The SEC’s scheduled meeting on January 11 looms just one day after the deadline to approve or deny the proposal presented by Ark and 21Shares.
This potential approval process could involve a seriatim vote, a method where votes are individually circulated among commissioners. The progression to the next commissioner occurs after each one casts their vote. However, this approach comes with complexities, including the risk of a ‘desk drawer veto’ if a commissioner holds onto a seriatim, effectively stalling the decision. The commission has previously forgone voting on certain crypto ETFs, delegating authority to staff to conserve resources.
SEC Commissioner Hester Peirce noted in June 2022 that early denials of bitcoin exchange-traded products often occurred under delegated authority. Challenges to matters of delegated authority can be raised by individual commissioners within ten days after the decision date, extending the approval process. While a spot bitcoin ETF might receive approval from staff under delegated authority, it could face denial in a subsequent commissioner vote.
In the past, commissioners have voted on select crypto ETFs. For instance, in January 2023, Gensler and Commissioners Caroline Crenshaw and Jamie Lizárraga voted against Ark and 21Shares’ Bitcoin ETF. In June 2023, the agency held votes on three unrelated ETF applications. In 2018, during the tenure of former SEC Chair Jay Clayton, commissioners unanimously rejected GraniteShares and ProShares bitcoin ETFs.
The SEC has refrained from commenting on whether a vote will occur this week. A spokesperson from the SEC informed Blockworks that if the Commission deems a registration statement effective, the information will be available on EDGAR, with any Commission 19b-4 orders being posted on the SEC website and published in the Federal Register.
This anticipated decision on the spot bitcoin ETF underscores the ongoing regulatory developments in the crypto space, with market participants closely monitoring SEC actions that could influence the broader adoption of digital assets.