Invesco reapplying for Bitcoin (BTC) ETF follows in BlackRock’s footsteps

Investment management company Invesco (IVZ), which has $1.4 trillion under management, re-applied for a spot bitcoin (BTC) exchange-traded fund (ETF).

In 2021, Invesco first applied for a bitcoin ETF in conjunction with Galaxy Digital. It also applied for a bitcoin futures ETF, but dropped its efforts in October 2021 after a futures ETF by ProShares was approved and began trading first.

In its filing, Invesco argued that the lack of a spot bitcoin ETF is pushing investors toward riskier options, as seen in insolvencies such as FTX, Celsius Network, BlockFi and Voyager Digital Holdings.

Invesco also emphasized the need for investor protection, saying approval of such a spot bitcoin ETF depends on a monitoring sharing agreement with a significant, regulated market, not on the regulation of the spot bitcoin market itself.

Monitoring sharing agreements facilitate the exchange of information about market trading activity, clearing processes and customer identification, which will significantly reduce the potential for market manipulation – something the Securities and Exchange Commission is very concerned about.

“The SEC is very concerned about market manipulation related to Bitcoin prices and has cited this in almost, if not all, previous rejections,”[ads1]; Graeme Moore, Head of Tokenization, at the Polymesh Association, previously told CoinDesk. “This is because the SEC’s view is that Coinbase and others are not regulated as exchanges and therefore cannot be relied upon to ‘prevent fraudulent and manipulative acts and practices.’

So far, the SEC has given no indication of when it plans to make an announcement regarding a bitcoin ETF.

Grayscale (which currently shares joint ownership with CoinDesk in the Digital Currency Group) has sued the SEC over its rejected bitcoin spot ETF. Speaking at CoinDesk’s Consensus Conference in Austin, GrayScale CEO Michael Sonnenshein said he expects a decision on the matter by September.

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