April 19, 2024
ARK's Updated Bitcoin ETF Filing Indicates Positive Progress towards Approval
Bitcoin News

ARK’s Latest Bitcoin ETF Filing Shows Positive Approval Progress

An amendment has been made to the joint application for a spot Bitcoin exchange-traded fund (ETF) by ARK Invest and 21Shares, indicating positive progress and potential approval. The revised filing, submitted to the United States Securities and Exchange Commission (SEC) on October 11, provides additional information about the proposed spot Bitcoin ETF, with a focus on custody practices and asset valuation.

Bloomberg’s senior ETF analyst, Eric Balchunas, sees these changes as a response to concerns raised by the SEC. He believes that ARK has addressed the SEC’s comments, which is a positive sign of progress. Balchunas stated that the changes are integrated throughout the filing, resulting in a five-page expansion, and none of the comments appear to be new or insurmountable.

One significant change involves ARK’s acknowledgment that the fund’s net asset value (NAV) calculations do not conform to Generally Accepted Accounting Principles (GAAP), an accounting standard used by the SEC. The amended filing also clarifies that the ETF’s assets, held by Coinbase Custody, are segregated from corporate or other customer assets.

Another Bloomberg ETF analyst, James Seyffart, interprets this clarification as a sign that ARK and other entities are actively addressing the SEC’s concerns, which he views as a positive indicator for potential future approval.

Scott Johnsson, a general partner at Van Buren Capital, pointed out another addition to the filing. It addresses the possibility of the ETF’s value declining if Bitcoin is increasingly used for illegal activities or if Bitcoin mining’s environmental impact leads to restrictions. According to Johnsson, based on ARK’s amendments, it appears that the agency is not imposing unnecessary roadblocks during the disclosure review process.

Image by Freepik

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