A recent amendment to ARK Invest and 21Shares’ joint spot Bitcoin (BTC) exchange-traded fund (ETF) application could be seen as a “good sign” of progress and impending approvals.
An amended Oct. 11 filing to the United States Securities and Exchange Commission for approval adds additional information about the proposed spot Bitcoin ETF, including practices for how the fund will custody assets and determine asset values.
Bloomberg senior ETF analyst Eric Balchunas said the changes could be in direct response to concerns the SEC has asked ETF issuers to address.
“It means ARK got the SEC’s comments and has dealt with them all, and now put [the] ball back in [the] SEC’s court,” Balchunas said. “[In my opinion] good sign, solid progress.”
Balchunas said the changes are “sprinkled throughout,” making the new filing five pages longer, adding in a separate post that “none of the comments were that new or insurmountable.”
Changes included ARK noting the fund’s net asset value (NAV) calculations are not in line with the Generally Accepted Accounting Principles (GAAP) — an accounting standard used by the SEC, said Balchunas.
The new filing also clarifies the ETFs assets, held by Coinbase Custody, are in “segregated accounts […] and are therefore not commingled with corporate or other customer assets.”
Fellow Bloomberg ETF analyst James Seyffart added in and X post the latter change signals that ARK and others are communicating with the SEC about what the regulator wants cleared up.
“Good sign for future approval IMO,” he added.
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Van Buren Capital general partner Scott Johnsson noted another new addition was a comment that if BTC is increasingly used for illegal purposes and if Bitcoin mining’s environmental impact causes it to be restricted, then the ETF’s value could fall.
Johnsson said, based on ARK’s amendments, it “doesn’t look like the agency is putting up any unnecessary roadblocks via disclosure review.”
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