Valkyrie expects spot #bitcoin ETFs to go effective Wednesday with trading beginning Thursday

Crypto traders are holding their breath waiting for the US Securities and Exchanges Commission to approve a first bitcoin spot exchange-traded fund — and one of the issuers, Valkyrie Investments, is anticipating a decision shortly.

“We’re expecting the SEC will deem the ETFs effective at close of business on Wednesday and the trading to begin on Thursday morning,” Valkyrie Investments co-founder and CIO Steven McClurg told The Block in an interview.

If and when trading begins on Thursday, McClurg expects $200 million to $400 million of investors’ funds coming to Valkyrie’s #ETF, and all participants might see $4-5 billion of inflows over the first couple of weeks, he said.

Not all the 13 ETF applicants might make it to the finish line in the first wave, though, but McClurg expects the first batch of 10 ETFs to launch at the same time. “I do suspect that one or two might not get off the ground on day one, just because there is a lot of work to be put in. I know that my team worked all through the Christmas holidays and over the last week, too, to be sure we’re ready to go,” he added.  

“There is a lot of work behind the scenes to go into something like that — it’s not like a normal ETF. One complication here is that you have two custodians, one for crypto and one for cash, and making sure that these two accounts are connected. It’s almost like double work to get launched in a situation like that,” McClurg explained.

The biggest hope for the #bitcoin spot ETF so far has been that it will attract the U.S. institutional investors, but McClurg said it’s likely that retail investors will be the first to pour money in. “Out of the gate, it’s going to be mostly retail, some financial advisors.

This is partly because financial advisors normally take some time to watch new financial products trade before they recommend them to clients.