On January 10, over a decade after the first Bitcoin spot Exchange-Traded Fund (ETF) application, the Securities and Exchange Commission (SEC) finally approved eleven applications on the same day. Trading began the next day, January 11. The recent round of approvals comes after much anticipation. The first-ever application for a Bitcoin spot ETF was back in 2013, from Gemini, a company co-founded by the Winklevoss brothers. The SEC rejected Gemini’s application in 2017 as well as subsequent application from the same company again in 2018. 

Exchange-Traded Funds allow investors to gain exposure to Bitcoin’s price volatility without having to invest in Bitcoin directly. Note that the SEC usually refers to ETFs as ETPs (Exchange-Traded Products); ETFs are just one type of ETPs. 

The general sentiment across the Bitcoin-sphere was one of excitement. Bitcoin Magazine called the SEC’s approval “a historic milestone in the evolution of Bitcoin adoption within traditional financial markets.” Investor Balaji Srinivasan called it “the spiritual reversal of Executive Order 6102” (referring to FDR’s 1935 seizure of America’s privately-held gold). For many, the SEC’s reluctant approval was seen as a bit of institutional validation for Bitcoin – especially after years of dismissal by the likes of establishment figures such as Warren Buffet, Jamie Dimon, and Elizabeth Warren. 

Even in SEC Chair Gary Gensler’s public statement announcing the Bitcoin spot ETF approval, he warned that “bitcoin is primarily a speculative, volatile asset that’s also used for illicit activity including ransomware, money laundering, sanction evasion, and terrorist financing.” (Gensler conveniently overlooks that fiat currencies, including the US dollar, are also used for all of the above).