Spot Bitcoin ETF: New Report Ignites Fears of Potential Rejection

By Ben Knight January 04, 2024 In Bitcoin, ETF, SEC
  • Matrixport report claims the SEC will reject applications largely due to politics and Gensler’s anti-crypto stance.
  • Lack of insider info and speculation fuel skepticism towards the report’s validity.
  • The media coverage of the report was far and wide, with Forbes, Coindesk and several prominent influencers weighing in on the matter.
  • Bloomberg and Fox journalists rubbish report, suggesting ETF approval is imminent despite market uncertainty.

A Bitcoin ETF has been the talk of the crypto town for the best part of six months. Analysts across both the crypto and traditional finance media have been well-documented stating the SEC approving an ETF in the near future is a fait accompli. However, a new report from Matrixport has poured cold water over the idea, with author Markus Thielen suggesting that the SEC could deny the pending applications yet again. 

Applications “Fall Short of Critical Requirement”.

According to the report, Bitcoin spot ETFs are missing a crucial requirement that would see the SEC reach a majority decision to approve the funds. There is one key factor that lead Thielen to believe the SEC will not reach a positive consensus:

SEC Chair Gensler is not embracing crypto in the US…an ETF would enable crypto overall to take off…[but Gensler] still sees this industry in need of more stringent compliance.

Markus Thielen

Basically, the report argues that because the head of the regulatory body is staunchly anti-crypto he will vote to reject the ETF as it would cause the market to surge and largely increase adoption among the everyday retail investor. 

Admittedly, the SEC and Gary Gensler haven’t exactly been friends of cryptocurrency over the past 12 months, targeting several big names in the industry in high-profile lawsuits (Coinbase, Binance, XRP). However, that’s more or less the entire rationale of the one-page Matrixport report – a politically-driven decision will block ETF approval, and there’s no insider information backing up this view. It is purely opinion-based speculation.


Despite this, the report was picked up by several big-name media outlets – Forbes and Coindesk – which may have led to the sea of red the crypto market has experienced over the past 24 hours, with BTC dropping nearly 6%. 

Community Reacts to Report with Skepticism 

While the market may have quickly jumped to panic (or simply opportunism) as a result of the document, the crypto community has been less than enthusiastic about the integrity of Thielen’s thoughts. 

There may be some merit in suggesting that the SEC has been fairly unpredictable in the way it tackles crypto-related matters. But with Bloomberg analyst Eric Balchunas suggesting that 3 of 5 SEC members are set to approve a Bitcoin ETF, and Eleanor Terrett reporting that the SEC is meeting with the big exchanges (Nasdaq, NYSE) today, it seems the report may be much ado about nothing.

Ben Knight

Ben Knight

Ben Knight is a writer and editor from Melbourne with a passion for all things music and finance. He enjoys turning complex topics – especially the technical details of cryptocurrency – into digestible bites that anybody can understand. He acquired his Master’s in Writing, Editing and Publishing from RMIT in 2019 and has run his own creative writing business ever since.

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