The Launch of Spot Bitcoin ETF Moves Closer as SEC Decides Not to Appeal Grayscale’s Case
The U.S. Securities and Exchange Commission (SEC) has chosen not to appeal an order requesting it to review Grayscale’s application to convert its Bitcoin Trust into an ETF. This decision greatly increases the chances of SEC approval for spot Bitcoin ETFs, with experts estimating a 90% possibility.
SEC Forgoes Appeal to Grayscale’s Case
On October 13, the SEC decided not to challenge a ruling that called for a review of Grayscale’s application for a spot Bitcoin ETF. This legal development has had a significant impact on the Grayscale Bitcoin Trust (GBTC) discount, which reached its lowest point this year at 15.88% on October 13.
Grayscale and the SEC have been engaged in a lengthy legal dispute regarding spot ETF applications. Grayscale argued that the SEC’s rejection of these applications was unfair and discriminatory against spot Bitcoin ETF issuers.
In August, a U.S. court ruled against the SEC, questioning its rationale for denying spot ETF applications while approving futures ETFs.
The SEC’s argument is based on concerns about investor protection in spot BTC ETFs, leading to the rejection of all such applications in the past decade.
Bitcoin ETF Approval Possibility Jumps to 90%
Bloomberg analysts have become more confident about the introduction of spot Bitcoin ETFs in the United States. They now estimate a 90% probability of SEC approval, citing increased interactions between the regulator and fund sponsors like Ark and 21 Shares.
“This back-and-forth between the SEC and fund sponsors is standard practice for new launches but a first for spot Bitcoin ETF applications, indicating that the SEC is working to approve Ark’s proposal.”
Previously, these analysts had estimated a 75% chance following Grayscale’s victory over the SEC in August. Several asset managers, including BlackRock, have pending applications for a spot Bitcoin ETF with the SEC.
Hot Take: Spot Bitcoin ETFs on the Verge of SEC Approval
The decision by the SEC not to appeal Grayscale’s case has significantly improved the outlook for spot Bitcoin ETFs. With experts estimating a 90% possibility of approval, it seems that these investment vehicles may finally be on their way to being launched in the United States. This development could have a significant impact on the cryptocurrency market, providing more accessibility and legitimacy for investors looking to enter the space. It remains to be seen how soon we will see the first spot Bitcoin ETF approved, but the momentum is certainly building.
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