BlackRock has submitted its new application for a bitcoin-based exchange-traded fund (ETF). After an initial send-back, the documentation is in, and the Securities and Exchange Commission (SEC) has confirmed that it’s reviewing the application. Many traders are waiting on the sidelines with their fingers crossed, hoping this is when the SEC gives a greenlight to bitcoin spot trading.

BlackRock Won’t Help Much

Despite the big move forward and all the anticipation leading up to it, many crypto experts think this won’t open the door to other companies preparing similar ETF applications in the future. If anything, we could even see lesser action in this department over the coming weeks and months.

Initially, there was a large swarm of companies that decided to initiate similar applications at around the same time BlackRock was submitting its own, but the fact remains that there are still many hurdles along the way, and there are several individuals out there who believe (despite the size and strength of BlackRock) that the institution won’t sway any members of the SEC enough to help them see bitcoin spot trading in a new light.

One of the big issues with this is the idea that much of the crypto space remains largely unregulated according to chief investment officer of Volatility Shares Stuart Barton, who recently garnered approval for a futures-based bitcoin ETF. Barton says this is one of the main reasons why the SEC has constantly delayed decisions and why it largely won’t move forward with any crypto products. He said in an interview:

The hold-up is because of the unregulated nature of the crypto exchanges. It takes a long time for an exchange to become regulated. That is a multi-year process. That’s a step before we get to an ETF approval. There’s no exchange on which bitcoin trades that is regulated.

Hedge fund manager James Koutoulas also threw his two cents into the mix, commenting that while it’s good everyone involved in crypto is behaving in an optimistic manner, they cannot allow the dissolution of reality to settle in. He mentioned:

It’s not a foregone conclusion that an ETF will be approved. You just [need] to look at the conflicts (example: lawsuit against Coinbase) for that.

Why is This so Hard?

Barton continued with:

The weakness of an application that needs 19b-4 is that you need a specific approval ruling to list from the SEC, and that puts the SEC in a very powerful position. They don’t have to argue with you [about] whether this is a good investment. They get to drill down because you’re really asking them, ‘Please, can we change the rules of our exchange in order to list this new underlying product as a new ETF?’ Very few 19b-4s get filed, and it’s a very long process.

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