BTC Spot ETF Applicants Address Most Concerns in SEC Meetings

"BTC spot ETF applicants have reportedly addressed many of the SEC's concerns in a series of meetings with the U.S. Securities and Exchange Commission (SEC)," reports The Block, citing multiple sources. "At that time, the SEC explained to the applicants that in order to be included in the initial list of approved BTC spot ETFs, they would need to adopt a cash redemption methodology," the sources said. However, Grayscale argued to the SEC that a significant number of U.S. ETFs use spot redemption, and that both cash and spot redemption should be allowed. In particular, Grayscale emphasized that for 30 years of the U.S. ETP market, all commodity ETPs have been spot-only, so BTC spot ETFs should be wary of breaking with this practice. However, the SEC did not buy this argument, and eventually Grayscale tacitly accepted the SEC's requirements." Grayscale recently updated its BTC spot ETF filings to reflect the change to cash redemptions. Another source added: "As is customary, ETF APs (intermediaries) are not disclosed in advance, but this time the applicants disclosed the list of APs as required by the SEC. The SEC has been paying particular attention to APs," said another source. "The applicants and the SEC also agreed that in the event of a Bitcoin hard fork, the BTC Spot ETF Trust will waive all rights and airdrops related to it," the media outlet emphasized.