Cathie Wood, founder and CEO of ARK Investment Management LLC, speaks during the Skybridge Capital SALT New York 2021 conference in New York City, U.S., September 13, 2021.
Cathie Wood, founder and CEO of ARK Investment Management LLC, speaks during the Skybridge Capital SALT New York 2021 conference in New York City, U.S., September 13, 2021. Reuters / Brendan McDermid

KEY POINTS

  • In June ARK and 21 Shares submitted the first amendment to its spot Bitcoin ETF application
  • The second amended prospectus was submitted in October
  • Bitcoin was trading up at $37, 208.03 as of 1:30 p.m. ET on Monday

ARK Investment Management and 21Shares are edging closer to the approval of their joint spot Bitcoin exchange-traded fund (ETF) following the submission of the third amendment to its prospectus, which contained a noteworthy update.

The submission, dated Nov. 20, provides details of the firms' proposed spot Bitcoin ETF, including major aspects such as custody practices and methods for valuing assets.

Interestingly, the amended prospectus also highlights a change in the fee, which has now increased to 80 bps from the previous 70 bps. This suggests a higher range for the anticipated expense ratios of their spot Bitcoin ETF, as noted by Bloomberg Intelligence ETF analyst James Seyffart.

"One minor change I did notice. Looks like the fee went from 70 bps in a past filing to 80 bps in this filing. Giving us a ballpark of where the expense ratios will start for these spot #bitcoin ETFs. Honestly a bit higher than i expected," Seyffart said in a tweet.

The ETF analyst also said that the latest update could only mean that" things are likely still moving with SEC conversations."

For another Bloomberg Intelligence ETF analyst Eric Balchunas, the latest prospectus amendment is a " Semi-shocker to be honest but in a good way," noting that "the more updates to these documents the better, shows them getting this bad boys in shape for SEC approval."

He also pointed out that the third update on ARK's spot Bitcoin ETF prospectus retained its in kind creations redemption instead of cash creations despite the supposed instruction from the U. S. Securities and Exchange Commission (SEC), explaining that "some issuers are going to try and push back and 'sell' the SEC on in-kind given the obv benefits for investors."

In June, ARK and 21Shares filed for an amendment that features a surveillance-sharing agreement, which aligns with industry practices.

The firms submitted another amended prospectus in October, outlining how the fund will custody assets and determine asset values.

Last week, the SEC announced a delay in its decision on the spot Bitcoin ETF of Franklin, GlobalX, and Hashdex, setting the deadline for its final decision on the filings to Jan. 1, 2024. This erases the possibility of a spot BTC ETF vehicle rolling out this year.

Bitcoin, the world's largest crypto asset by market capitalization, was trading in the green zone at $37, 208.03 as of 1:30 p.m. ET on Monday with a 24-hour trading volume down by 22.97% at $10,199,070,534.

BTC's price action represented a 1.17% gain over the past 24 hours and a 0.9% spike over the last seven days.

Data from CoinMarketCap revealed that BTC's circulating supply stands at 19,547,962 BTC with its value climbing by 0.32% at a $727,341,170,580 market cap.

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