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SEC Opens Public Comments On Franklin Templeton and Hashdex Spot Bitcoin ETFs

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The U.S. Securities and Exchange Commission is seeking public commentary on the spot Bitcoin ETF applications from Franklin Templeton and Hashdex in a move cheered on by crypto bulls.

On Nov. 28, the SEC published filings instituting proceedings to receive public feedback on the proposed Franklin Bitcoin ETF and Hashdex Bitcoin Futures ETF funds.

“The Commission is instituting proceedings to allow for additional analysis of the proposed [funds],” the SEC said. “Institution of proceedings does not indicate that the Commission has reached any conclusions with respect to any of the issues involved. Rather, as described below, the Commission seeks and encourages interested persons to provide comments on the proposed rule change.”

James Seyffart, an ETF analyst at Bloomberg, tweeted that the SEC is instituting proceedings for the funds much earlier than would be required — with the move coming just two weeks after the SEC delayed its deadline for delivering a verdict on the respective ETF applications.

Seyffart interpreted the news as further evidence that the SEC may be gearing up to approve multiple spot Bitcoin ETF proposals around early January. Respondents now have 21 days to submit feedback, plus an additional two weeks to file rebuttals to any submission received by the SEC — meaning the comment periods would expire in early January.

“This… all but confirms for me that this was likely a move to line every applicant up for potential approval by the Jan 10, 2024 deadline,” he said.

Scott Johnsson, a finance lawyer, agreed that the SEC filings suggest the regulator is preparing to approve the funds around Jan. 10. “Really the only way it makes sense,” he tweeted. “Pretty sure we can lock this one up.”

However, Seyffart noted that the SEC’s filing only concerns the prospective issuers’ 19b-4 filings. “We know from updates and other sources that SEC still isn’t quite ready to approve the S-1s (prospectuses) just yet,” he said. “So approval could happen here without immediate launch.”

Seyffart added that the applications could still be denied despite his bullishness.

Bitcoin tagged new highs for 2023 in response to the news, with BTC last changing hands for $37,980 after gaining 2.4% in 24 hours, according to CoinGecko.

The news follows several months of bullish market momentum ignited by expectations the SEC could soon approve a spot Bitcoin ETF for the first time. A spot Bitcoin ETF would directly invest in BTC on behalf of investors and exert bullish pressure on Bitcoin’s finite supply, unlike existing — which speculate on derivative contracts.

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The SEC urged interest parties to comment on the market manipulation susceptibility of Bitcoin, the proposed funds, and the exchanges on which the ETFs would trade. It also requests feedback on whether the exchanges can provide sufficient liquidity to support consumer demand, the efficacy of the pricing mechanisms employed by the ETFs, and any other concerns held by commenters.



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