On June 23, Brazil’s stock exchange listed a Bitcoin ETF, marking a significant step in Latin America’s embrace of regulated crypto investment vehicles. On the same day, Nasdaq Dubai approved the region’s first Bitcoin fund. Yet, in contrast to these advances, the U.S. Securities and Exchange Commission (SEC) postponed its decision on the Valkyrie Bitcoin ETF, extending the review period to August 10. A week earlier, the regulatory body had also delayed its verdict on the VanEck Bitcoin ETF application.
A Bitcoin ETF simplifies investing in Bitcoin by packaging the cryptocurrency into a tradable asset that fits within conventional brokerage structures. It significantly lowers the barrier to entry by eliminating the need for private wallets or complex private key management. This opens the door for more traditional equity investors to enter the crypto space safely and conveniently.
While countries like Canada and now Brazil have moved forward with Bitcoin ETF approvals, the United States—where the first application was filed as far back as 2013—has yet to greenlight such a product. So, where does the global regulatory landscape currently stand? And how long can the SEC continue to delay its decision? This article provides a clear picture of the worldwide Bitcoin ETF scene, along with a detailed timeline of the SEC’s pending decisions.
Bitcoin ETF Progress in the Americas and Middle East
Brazil and Canada Lead the Way
Brazil made history by approving the QR Capital Bitcoin ETF (QBTC11) on the B3 exchange in São Paulo. This makes Brazil the second country, after Canada, to approve a Bitcoin ETF. With a population of 215 million, Brazil’s endorsement of a Bitcoin ETF offers investors a regulated, accessible, and secure channel for gaining Bitcoin exposure.
Fernando Carvalho, CEO of QR Capital, described the listing as a "historic moment for both crypto and traditional financial markets." The QBTC11 ETF uses the CME CF Bitcoin Reference Rate—the same benchmark utilized for Bitcoin futures contracts. As of June 24, the fund’s net assets were valued at approximately $23.28 million, with an annual management fee of 0.75%.
Simultaneously, the Nasdaq Dubai approved the listing of the Bitcoin Fund from Canadian asset manager 3iQ. Trading under the symbol QBTC, the fund opened at a reference price of $34.57 and saw an 11% increase on its first trading day. It is important to note that this product is structured as an exchange-traded product (ETP), not a pure ETF.
ETPs encompass a range of exchange-traded instruments, including ETFs, exchange-traded notes (ETNs), and others. While all ETPs are traded on exchanges and offer intraday liquidity, an ETF specifically aims to track the performance of an index, commodity, or asset—in this case, Bitcoin.
Canada’s Established Bitcoin ETF Market
Canada has approved four Bitcoin ETFs, all trading on the Toronto Stock Exchange. Data from OKLink reveals the following key figures as of June 24:
- Purpose Bitcoin ETF: Holdings of 21,184.64 BTC, with total assets under management (AUM) of $739 million.
- 3iQ CoinShares Bitcoin ETF: Holdings of 21,155.41 BTC, valued at approximately $730 million.
- CI Galaxy Bitcoin ETF: Holdings of 3,130.62 BTC, with an AUM of $108 million.
- Evolve Bitcoin ETF: Holdings of 1,700.31 BTC, with an AUM of $71.2 million.
Combined, these four funds hold over 47,170 BTC, with a total AUM exceeding $1.64 billion. Despite recent Bitcoin price declines affecting AUM figures, the consistent growth in Bitcoin holdings by funds like the Purpose Bitcoin ETF indicates steady capital inflow and increasing investor adoption.
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The US Regulatory Delay: Strategies and Upcoming Deadlines
In stark contrast to Canada and Brazil, the United States has yet to approve any Bitcoin ETF application. The SEC has consistently cited concerns over market manipulation, liquidity, and investor protection in its rejections or delays.
The regulatory process allows the SEC a 45-day initial review window for ETF applications, which can be extended up to a maximum of 240 days. For the most anticipated applications currently under review, here is a projected timeline:
- VanEck Bitcoin ETF: Final decision deadline is November 14, 2021.
- WisdomTree Bitcoin ETF: Final decision deadline is December 11, 2021.
- Kryptoin Bitcoin ETF: Final decision deadline is December 24, 2021.
- Wise Origin Bitcoin ETF (Fidelity): Final decision deadline is January 26, 2022.
This means that if the first three applications are rejected, a U.S. Bitcoin ETF is highly unlikely in 2021.
The Role of SEC Leadership
The appointment of Gary Gensler as SEC Chairman in April 2021 brought optimism to the crypto community. Gensler, who taught a course on blockchain and digital currencies at MIT, is recognized as knowledgeable in the field. He has acknowledged that cryptocurrencies are a "catalyst for change."
However, in his official capacity, Gensler has emphasized the need for stronger investor protections and a more robust regulatory framework before approving a Bitcoin ETF. He has warned investors about the volatility and risks inherent in the crypto market, indicating that the SEC’s cautious approach is likely to continue until these concerns are adequately addressed.
Global Perspectives: Australia and South Africa
Beyond North and South America, other countries are also evaluating Bitcoin ETFs.
In Australia, investment firms VanEck and BetaShares have submitted ETF applications to the Australian Securities Exchange (ASX). The ASX has not commented on the likelihood of approval but stated it is monitoring developments in crypto-based investment products closely.
In South Africa, the Johannesburg Stock Exchange (JSE) recently rejected a Bitcoin ETF application from Sygnia Asset Management for the second time, citing an lack of appropriate regulatory framework for cryptocurrencies. This highlights that regulatory hesitation is a global phenomenon, not limited to the U.S.
Frequently Asked Questions
What is a Bitcoin ETF?
A Bitcoin ETF is an exchange-traded fund that tracks the price of Bitcoin. It allows investors to gain exposure to Bitcoin’s price movements without having to buy and store the cryptocurrency themselves, as shares of the ETF are bought and sold through a traditional brokerage account.
Why does the SEC keep delaying its decision on Bitcoin ETFs?
The SEC has repeatedly expressed concerns about the potential for market manipulation and fraud in the underlying Bitcoin spot markets. It is delaying decisions to seek more time to evaluate whether the proposed ETFs have sufficient safeguards to protect investors from these risks.
What is the difference between a Bitcoin ETF and a Bitcoin ETP?
An ETF is a type of Exchange-Traded Product (ETP). While all ETFs are ETPs, not all ETPs are ETFs. ETP is a broader term that also includes exchange-traded notes (ETNs) and other structures. The key difference often lies in the legal structure and the type of asset backing the product.
Which countries have approved a Bitcoin ETF?
As of now, Canada and Brazil are the only two countries that have approved spot Bitcoin ETFs. Several other countries, including some in Europe, have approved Bitcoin ETPs or similar exchange-traded notes.
How can I invest in Bitcoin without an ETF?
There are several ways to gain Bitcoin exposure, including buying Bitcoin directly on a cryptocurrency exchange, investing in Bitcoin trusts, or purchasing shares of companies with significant Bitcoin holdings. Each method comes with its own set of risks and considerations.
Will the U.S. eventually approve a Bitcoin ETF?
Most industry analysts believe it is a matter of "when," not "if." The growing institutional adoption, increasing market maturity, and the filing of applications by major traditional finance firms like Fidelity add significant pressure and legitimacy, making eventual approval seem likely.