January 11, 2024 (MLN): The US Securities and Exchange Commission (SEC) has approved spot Bitcoin exchange-traded funds (ETFs) for the first time, a landmark moment for the industry that paves the way for new investors to get exposure to crypto.
The ETFs enable investors to access bitcoin through conventional brokerage accounts, rather than crypto-native startups that face growing regulatory pressure after numerous scandals and bankruptcies.
"Today, the commission approved the listing and trading of a number of spot bitcoin exchange-traded product (ETP) shares," said SEC Chair Gary Gensler in a statement.
Cynthia Lo Bessette, head of digital asset management at Fidelity, one of the bitcoin ETF issuers said that these ETFs would be an efficient way for investors to gain exposure to Bitcoin.
Bitcoin briefly jumped past $47,000 following the approvals, before paring most of its gains to trade around $46,084 [10:48am PST]
The largest cryptocurrency, which plummeted 64% in 2022, has surged around 2.8x in 2023 as investors anticipated the SEC’s approval of Bitcoin-spot ETFs.
Although the SEC approved the ETFs, Gary Gensler said that it did not approve or endorse bitcoin.
"Investors should remain cautious about the myriad risks associated with bitcoin and products whose value is tied to crypto," he added.
To note, the SEC approved a total of 11 spot bitcoin ETFs, offered by BlockRock, Grayscale, Valkyrie, Hashdex, Bitwise, BZX, Invesco, VanEck, WisdomTree, Fidelity, and Franklin.
