SEC's decision on bitcoin ETFs is highly anticipated by cryptocurrency investors.

The U.S. Securities and Exchange Commission is expected to rule on the trading of a spot bitcoin exchange-traded fund, which has been a long-awaited goal for crypto investors.

13 companies have filed for a spot bitcoin ETF:

• Grayscale Bitcoin Trust
• Ark/21Shares Bitcoin Trust
• Bitwise Bitcoin ETF Trust
• BlackRock Bitcoin ETF Trust
• VanEck Bitcoin Trust
• WisdomTree Bitcoin Trust
• Valkyrie Bitcoin Fund
• Invesco Galaxy Bitcoin ETF
• Fidelity Wise Origin Bitcoin Trust
• Global X Bitcoin Trust
• Hashdex Bitcoin ETF
• Franklin Templeton Digital Holdings Trust
• Pando Asset Spot Bitcoin Trust

How the SEC will proceed

There are two components to the applications:

The 19b-4 filing is a form used by exchanges to inform the SEC of a proposed rule change. In this case, a rule change is required under the Securities Exchange Act of 1934 because a spot bitcoin ETF is a new product, and the exchanges — NYSE, Nasdaq and Cboe — must provide rules to explain how the product will trade. The SEC must approve the rule changes before the product can trade. The deadline for the Ark/21Shares Bitcoin Trust is January 10.

The Grayscale Bitcoin Trust requires an S-3 filing for approval, which is a streamlined form for companies that have already met other reporting requirements.

The SEC is expected to approve the 19b-4 filings, after which it may approve the S-1 applications of some, but not all, ETF applicants at once.

Wide spread in fee

The substantial interest in the fee structure of the 13 bitcoin ETF filings, which are all similar products, is evident.

The expense ratios for various Bitcoin funds have been announced. Fidelity's Wise Origin Bitcoin Fund will charge 39 basis points, while Invesco's Galaxy Bitcoin ETF will charge 59 basis points, which are waived for the initial six months and the first $5 billion in assets. Ark/21Shares and Valkyrie will charge 80 basis points.

The Grayscale Bitcoin Trust currently charges a 2% fee, but has stated its intention to reduce the fee once its application to become a Bitcoin ETF is approved.

Other applicants have not yet announced their fee structure.

It is unclear who the main regulator of the crypto industry is

Gary Gensler's ongoing battle with the crypto industry is taking place against this backdrop.

Gensler has faced legal challenges from prominent crypto companies, including a losing battle against Grayscale Bitcoin Trust, which won a case against the SEC last summer. The U.S. Court of Appeals for the D.C. Circuit ruled that the SEC had already approved a futures-based bitcoin product and failed to provide a clear explanation for its refusal to approve a spot-bitcoin product. The court essentially stated that the futures and spot markets are similar, and if the SEC approved one, it logically had to approve the other.

The SEC has taken a stance that Bitcoin is a commodity, but there are no such rulings for other cryptocurrencies. Due to the lack of clear federal rules, the SEC has resorted to enforcement to demonstrate that many cryptocurrencies are securities and thus has regulatory authority over much of the crypto industry.

The SEC has alleged that Coinbase, the largest U.S. crypto exchange, violated rules requiring it to register as an exchange. As a result, the SEC claims that some of the crypto assets traded on Coinbase are securities and fall under the SEC's jurisdiction.

Gensler stated that the SEC filed a lawsuit against Binance and its founder Changpeng Zhao in June, accusing them of deceit, conflicts of interest, lack of disclosure, and intentional evasion of the law.

In November, the U.S. Department of Justice settled charges against Binance and Zhao, with Zhao pleading guilty to money laundering violations and agreeing to pay a $50 million fine and step down as CEO. Additionally, Binance accepted the appointment of a government monitor to oversee its business.

Cathie Wood of ARK Invest will be a guest on "Halftime Report" at 12:35 p.m. on Monday and on "ETF Edge" from 1:10 p.m. to 1:30 p.m. ET on ETFEdge.bizfocushub.com.