This is not investment advice. The author has no position in any of the stocks mentioned. Wccftech.com has a disclosure and ethics policy.
After its anti-crypto stance failed to withstand scrutiny in courts, forcing the apex US financial regulator to resort to a hefty dose of inertia - more appropriately described as dragging one's feet - presumably in a last-ditch effort to create as many legally tenable hurdles as possible, the SEC has finally approved some of the first spot Bitcoin ETFs for trading on eligible American exchanges. This much-expected capitulation of sorts, however, has been overshadowed by yesterday's dramatic events, replete with a Hollywood-like caricature hacking incident.
“Order granting accelerated approval” it’s over. Thank God. pic.twitter.com/qCozlxzSBX
— Eric Balchunas (@EricBalchunas) January 10, 2024
To wit, the SEC has now officially approved all outstanding applications for spot Bitcoin ETFs. Trading in these investment vehicles is now expected to commence on Thursday.
As we noted in a dedicated post on Tuesday, an unauthorized third party was able to gain access to the SEC's X account for a brief moment to declare that the apex US financial watchdog had approved spot Bitcoin ETFs for listing on all eligible exchanges. Just moments thereafter, the SEC's chair Gary Gensler clarified that no such approval had been accorded as yet.
We can confirm that the account @SECGov was compromised and we have completed a preliminary investigation. Based on our investigation, the compromise was not due to any breach of X’s systems, but rather due to an unidentified individual obtaining control over a phone number…
— Safety (@Safety) January 10, 2024
A formal investigation by X then revealed that the unauthorized party was able to take control of the SEC's account via the associated phone number. To make matters worse, the SEC's official X account lacked the two-factor authentication that would have rendered such a feat quite difficult.
The @SECGov under @GaryGensler lacks faithful allegiance to its own lecturing blather 👇🏻 https://t.co/pwoTfPIr2N
— CryptoLaw (@CryptoLawUS) January 10, 2024
In the online roasting that followed, people were quick to identify the SEC's apparent lack of willingness to follow its own advice regarding basic security features like two-factor authentication.
🚨BREAKING: Senators @JDVance1 & @SenThomTillis Demand Explanation For The SEC's Errant Announcement Of The Approval Of Spot-Bitcoin ETFs
"It is unacceptable that the agency entrusted with regulating the epicenter of the world’s capital markets would make such a colossal error." pic.twitter.com/xG77jM9xAM
— Senator Vance Press Office (@SenVancePress) January 10, 2024
Of course, given the grave ramifications, at least two US Senators - J.D. Vance and Thom Tillis - have now called on Gensler to provide a formal explanation.
LOWER: BlackRock has just cut the fee on its spot Bitcoin ETF to 0.25% (and 0.12% for the first $5b). They really going for the jugular here, looking to crush the others bf they even born, just brutal. ARK has also cut to 0.21%. Bitwise curr low at 0.20%. Terrordome life. pic.twitter.com/PtSrvAinbW
— Eric Balchunas (@EricBalchunas) January 10, 2024
Meanwhile, as we detailed in another related post, Wall Street has entered into a full-fledged price war mode over these spot Bitcoin ETFs. Today, the investment titan BlackRock cut its fees to just 0.25 percent. What's even more shocking, BlackRock will now charge just 0.12 percent in annual fees until it earns $5 billion in revenue. According to most analysts, the expense ratio on these ETFs, given the custody costs involved, is likely in the range of mid-teen percent. Moreover, the ETF industry generally does not raise its fees. This means that we are about to witness a classic dog-eat-dog scenario, and only the fittest will survive the oncoming onslaught.
For the benefit of those confused over all of the brouhaha surrounding the launch of these spot Bitcoin ETFs, do note that Bitcoin's futures-based ETFs suffer from material underperformance since the contracts for the months ahead are usually priced at a premium to the spot price in what is known as contango, leading to progressively expensive roll-overs as the front-month contract expires and the next one takes its place. Spot Bitcoin ETFs, on the other hand, sidestep this major bottleneck entirely, leading to elevated investment inflow expectations.
Wealth managers in the US currently manage assets worth around $48 trillion. If just 1 percent of these assets are redeployed within the Bitcoin ecosystem courtesy of the upcoming spot ETFs, it would result in an investment inflow of nearly $500 billion! For context, Bitcoin's entire market capitalization is just around $900 billion at the moment.
About the author: Writing is my one incontrovertible passion. Over the past six years, he has authored over 2,200 distinct articles on financial and tech-related topics, spanning nearly 1 million words. And he has been a member of Wcctech mobile team since 2025. As an alumnus of the University of Toronto, Rotman Commerce Program, I bring nuance, in-depth knowledge, and a unique perspective to every topic that I cover. When I'm not writing, I'm traveling the world, exploring hidden confectionaries and restaurants as an aspiring food connoisseur.
Follow Wccftech on Google to get more of our news coverage in your feeds.
