The Securities and Exchange Commission (SEC) has finally approved the United States’ first regulated spot Bitcoin ( BTC ) exchange-traded funds (ETF) — a decade after it received the first application.

On Jan. 9, the securities regulator said it had granted approval for Bitcoin ETFs through a rule change that allows a spot Bitcoin ETF to be listed and traded on the respective exchanges.

Today the SEC grants approval for #Bitcoin ETFs for listing on all registered national securities exchanges.

The approved Bitcoin ETFs will be subject to ongoing surveillance and compliance measures to ensure continued investor protection. pic.twitter.com/oJinqv0wcR

— U.S. Securities and Exchange Commission (@SECGov) January 9, 2024

The historic approval paves the way for the first regulated exchange-traded product in the U.S. to give investors direct exposure to the price of Bitcoin without requiring them to buy it or worry about self-custody. Investors will instead buy shares in ETFs that hold Bitcoin as their underlying asset.

It comes over ten years after Cameron and Tyler Winklevoss first applied to launch the Winklevoss Bitcoin Trust in 2013. The SEC has consistently denied all spot Bitcoin ETF requests, citing concerns over potential market manipulation and fraud.

However, the SEC was forced to revisit its position after Grayscale won a court case in August 2023 that overturned the SEC’s denial of its application to convert its Bitcoin Trust into a spot Bitcoin ETF.

With the spot Bitcoin ETFs approved, the industry will now be closely watching when the ETFs begin trading.

Galaxy Research head of digital Alex Thorn has estimated that spot Bitcoin ETF inflows could reach $14 billion in the first year, while global fund manager VanEck estimates that roughly $2.4 billion would flow into spot Bitcoin products in the first quarter of 2024.

Launching a spot Bitcoin ETF in the United States requires the SEC to approve both the  S-1 (or S-3) and 19b-4 forms  filed by the issuers.

Related: Bitcoin ETF launch may be a ‘let down’ but could attract trillions over time

On Jan. 8, ten issuers filed their final amended S-1 and S-3 filings, notably announcing the fees they intend to charge for their respective Bitcoin ETFs. 

BlackRock, the world's largest asset manager, will charge 0.2% fees until the fund reaches $5 billion in assets under management (AUM). Bitwise follows  close behind at 0.24%, while Ark 21Shares and VanEck trail slightly with 0.25% fees.

Notably, Ark 21 Shares will waive all fees for the first six months or until the product reaches $1 billion AUM.

Grayscale currently stands as the highest-fee Bitcoin ETF product, levying a 1.5% fee rate on its prospective investors. 

This is a developing story, and further information will be added as it becomes available.

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