SEC Delays BlackRock Bitcoin ETF Decision Until 2025

The U.S. Securities and Exchange Commission (SEC) has initiated proceedings on BlackRock's proposed Bitcoin ETF, focusing on the in-kind creation model. This model allows authorized participants to exchange ETF shares directly for Bitcoin, rather than using cash. The SEC's decision to review this proposal comes as part of a broader evaluation of crypto-related ETFs, including those from other major financial institutions.

The SEC has delayed its decision on BlackRock's request to enable in-kind redemptions for its approved spot Bitcoin ETF. This delay is part of a larger trend of the SEC taking more time to review and approve crypto ETFs. The commission has also postponed decisions on other crypto-related proposals, until late 2025. This extended review period is aimed at ensuring that these products are safe for investors and comply with market regulations.

The SEC's cautious approach under new Chair reflects a more deliberate and open-minded stance towards crypto. The commission is allowing for public comments and discussions on new crypto products, which could lead to better-informed decisions in the long run. This approach is evident in the SEC's acceptance of the Dogecoin ETF application and the dropping of past cases.

BlackRock's proposed in-kind creation model for its Bitcoin ETF is a significant development in the crypto ETF landscape. If approved, it would allow investors to swap ETF shares for actual Bitcoin, providing a more direct and potentially more efficient way to invest in the cryptocurrency. However, the SEC's review process is thorough, and the final decision on this proposal is not expected until late 2025.

The SEC's delay in approving crypto ETFs, including BlackRock's Bitcoin ETF, is part of a broader trend of increased scrutiny and regulation in the crypto market. The commission's open-minded approach, however, suggests that it is considering crypto seriously and is willing to engage with the industry to develop appropriate regulations. This could pave the way for more crypto ETFs in the future, providing investors with greater access to the crypto market.