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2 Stocks to Watch as the SEC Stalls on Bitcoin ETF Filings (Revised)
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The last week of August brought some cheer to crypto investors in an otherwise dull month, with The U.S. Court of Appeals siding with Grayscale in its lawsuit against the U.S. Securities and Exchange Commission (“SEC”). Earlier, the SEC had denied Grayscale’s application to convert its popular Grayscale Bitcoin Trust (GBTC - Free Report) to an ETF.
A judge informed the SEC that its denial of Grayscale’s spot Bitcoin ETF application would have to be reviewed because it failed to provide a coherent explanation for its denial. It must be noted that the court ruling isn't the same as an approval, and the securities regulator still has 45 days to appeal the judge's opinion. So even as the court’s stance is a positive development from a crypto investors’ perspective with respect to crypto getting further mainstream acceptance, resistance from the regulatory institutions remains.
In fact, in an almost retaliatory move, the SEC pushed back on the other existing Bitcoin ETF applications, saying it needs a longer period to evaluate these applications. According to its filings, it'll need until at least Oct 17 to decide whether to approve or reject most of the applications. Bitcoin (BTC) prices fell after these SEC delays were reported and have since hovered below the $27000 mark.
One must track some of the major Bitcoin ETF applicants at this current juncture to understand the impact the SEC’s hawkish stance might have on them. These are some of the biggest names in the traditional marketplace that have decided to explore the crypto space in recent months. These companies are also directly impacted by the SEC’s announced delay in passing the verdict.
BlackRock, Inc. (BLK - Free Report) : This enterprise risk management and fixed-income institutional asset manager applied to launch a Bitcoin exchange-traded fund in June. BlackRock is the world’s largest asset manager. BlackRock’s expected earnings growth rate for the current year is 0.3%. However, it expects to grow at the rate of 13.2% in 2024. BLK currently carries a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Invesco Ltd. (IVZ - Free Report) : This investment management company had first filed for a Bitcoin ETF in 2021 but dropped it in October of the same year. However, in June of 2023, it joined the race to be the first investment industry giant to launch a Bitcoin ETF. Invesco’s expected earnings growth rate for the current year is -8.9%. However, it expects to grow at the rate of 23.3% in 2024. IVZ currently carries a Zacks Rank #5 (Strong Sell).
Also affected is Boston-based Fidelity Investments, one of the largest asset managers in the world. Fidelity had also applied to launch a Bitcoin exchange-traded fund in late June 2023.
(We are reissuing this article to correct a mistake. The original article, issued on September 4, 2023, should no longer be relied upon.)
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2 Stocks to Watch as the SEC Stalls on Bitcoin ETF Filings (Revised)
The last week of August brought some cheer to crypto investors in an otherwise dull month, with The U.S. Court of Appeals siding with Grayscale in its lawsuit against the U.S. Securities and Exchange Commission (“SEC”). Earlier, the SEC had denied Grayscale’s application to convert its popular Grayscale Bitcoin Trust (GBTC - Free Report) to an ETF.
A judge informed the SEC that its denial of Grayscale’s spot Bitcoin ETF application would have to be reviewed because it failed to provide a coherent explanation for its denial. It must be noted that the court ruling isn't the same as an approval, and the securities regulator still has 45 days to appeal the judge's opinion. So even as the court’s stance is a positive development from a crypto investors’ perspective with respect to crypto getting further mainstream acceptance, resistance from the regulatory institutions remains.
In fact, in an almost retaliatory move, the SEC pushed back on the other existing Bitcoin ETF applications, saying it needs a longer period to evaluate these applications. According to its filings, it'll need until at least Oct 17 to decide whether to approve or reject most of the applications. Bitcoin (BTC) prices fell after these SEC delays were reported and have since hovered below the $27000 mark.
One must track some of the major Bitcoin ETF applicants at this current juncture to understand the impact the SEC’s hawkish stance might have on them. These are some of the biggest names in the traditional marketplace that have decided to explore the crypto space in recent months. These companies are also directly impacted by the SEC’s announced delay in passing the verdict.
BlackRock, Inc. (BLK - Free Report) : This enterprise risk management and fixed-income institutional asset manager applied to launch a Bitcoin exchange-traded fund in June. BlackRock is the world’s largest asset manager. BlackRock’s expected earnings growth rate for the current year is 0.3%. However, it expects to grow at the rate of 13.2% in 2024. BLK currently carries a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Invesco Ltd. (IVZ - Free Report) : This investment management company had first filed for a Bitcoin ETF in 2021 but dropped it in October of the same year. However, in June of 2023, it joined the race to be the first investment industry giant to launch a Bitcoin ETF. Invesco’s expected earnings growth rate for the current year is -8.9%. However, it expects to grow at the rate of 23.3% in 2024. IVZ currently carries a Zacks Rank #5 (Strong Sell).
Also affected is Boston-based Fidelity Investments, one of the largest asset managers in the world. Fidelity had also applied to launch a Bitcoin exchange-traded fund in late June 2023.
(We are reissuing this article to correct a mistake. The original article, issued on September 4, 2023, should no longer be relied upon.)