Grayscale’s Legal Victory Boosts GBTC Shares
On August 29, Grayscale won its legal battle against the SEC, resulting in a significant increase in trading volume for its GBTC shares. The share price rose by almost 17% from the previous day, reaching a 2-year high. Over 19 million GBTC shares changed hands, marking the fund’s busiest day in over a year.
GBTC Discount Narrows After Court Ruling
Grayscale’s victory has a bullish outlook for the fund, as it is one step closer to converting GBTC into a Spot Bitcoin ETF. The fund has seen a discount as high as 48.89% of its net asset value, which has reduced to about 18% after the court ruling. However, there is a possibility that this gap could close further if Grayscale’s ETF application is approved.
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SEC’s Denial Challenged by Grayscale
Grayscale filed a lawsuit claiming that the SEC acted unfairly by denying its GBTC ETF application while approving similar Bitcoin futures funds. The court agreed with Grayscale’s argument that the SEC had not provided sufficient reason for the denial. The ruling eliminates the SEC’s primary reason for denying a Spot Bitcoin ETF, potentially increasing the likelihood of approval for pending applications.
SEC’s Next Steps and Potential Impact
It remains to be seen how the SEC will respond to the Court of Appeals’ ruling. If the SEC cannot find another reason to deny Spot Bitcoin ETF applications, it will likely have to approve them. This legal victory for Grayscale and the crypto community may pave the way for further growth and adoption of Bitcoin ETFs.
