U.S. Court Orders SEC to Revisit Bitcoin ETF Application
A U.S. circuit court in Washington D.C. has ordered the Securities and Exchange Commission (SEC) to reconsider its rejection of a Bitcoin exchange-traded fund (ETF) application filed by Grayscale, a crypto hedge fund.
However, this doesn’t guarantee that the SEC won’t find new reasons to reject the application or other similar ones.
SEC Rejection or Delay Could Impact Bitcoin Price
Industry insiders and investors in the crypto space anticipate a surge in the price of Bitcoin and other cryptocurrencies if the SEC approves a Bitcoin ETF. On the other hand, any news of the SEC rejecting a Bitcoin ETF could lead to a decline in the price of Bitcoin.
Nate Geraci, president of ETF Store, warned that if the SEC doesn’t approve a Bitcoin ETF in January, it could result in one of the biggest downturns in crypto history.
SEC’s Resistance to Institutional Financiers
The SEC has shown reluctance to make it easy for institutional financiers who want to launch a Bitcoin ETF. It has rejected “in-kind” structured ETFs and insisted on “cash create” ETFs instead. This stance by the SEC could potentially delay the approval of an ETF beyond January.
Potential Threat to Crypto Exchanges
If a spot Bitcoin ETF is launched, it could have significant implications for crypto exchanges. Eric Balchunas, senior Bloomberg ETF analyst, predicts that a Bitcoin ETF would greatly reduce trading fees for investors and create competition for popular crypto exchanges like Coinbase.
Hot Take: The Battle Continues Between Regulators and Funds
The ongoing battle between regulatory bodies like the SEC and financial institutions seeking to launch a Bitcoin ETF is causing uncertainty in the crypto market. While there is hope for an ETF approval in the future, delays and rejections have the potential to impact the price of Bitcoin and disrupt the crypto trading landscape.
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