SEC Decides Not to Appeal Court’s Ruling on Grayscale Investments
The United States Securities and Exchange Commission (SEC) has chosen not to challenge a recent court decision involving Grayscale Investments, according to Reuters. On August 29, the US District of Columbia Court of Appeals granted Grayscale’s request to convert its Grayscale Bitcoin Trust into a spot Bitcoin exchange-traded fund (ETF), overturning the SEC’s initial denial. The SEC will now review Grayscale’s application for the conversion, although this does not guarantee approval. The appeals court is also expected to issue instructions on how the ruling should be implemented.
Bloomberg Analysts Optimistic About Spot Bitcoin ETF Approval
Bloomberg analysts James Seyffart and Eric Balchunas remain positive about the likelihood of a spot Bitcoin ETF being approved in the US. Seyffart had previously estimated a 75% chance of approval in 2023 and a 90% chance by the end of 2024. In a recent post on Twitter, Seyffart emphasized his unchanged view on the matter. He also mentioned that changes made to the joint ETF filing by Ark Invest and 21 shares indicate a “constructive conversation” with the SEC, potentially leading to approval. Based on this, Seyffart and Balchunas believe there is a 90% chance that the ARK 21Shares Bitcoin ETF bid will be approved by January 10, 2024.
Efforts to Address Market Manipulation Concerns
The SEC has previously rejected spot Bitcoin ETF filings due to concerns about market manipulation protection for investors. In response to this requirement, asset managers like Ark/21Shares have entered into surveillance-sharing agreements with major crypto exchange Coinbase. These agreements aim to address the SEC’s concerns and increase the chances of ETF approval. The SEC’s decision not to appeal the Grayscale ruling and the ongoing discussions between Grayscale and the SEC indicate a potential shift towards a more favorable regulatory environment for spot Bitcoin ETFs in the US.
Hot Take: Spot Bitcoin ETF Approval on the Horizon?
The SEC’s choice not to appeal the court’s decision regarding Grayscale Investments is a significant development for the cryptocurrency industry. It signals a potential opening for spot Bitcoin ETFs in the US market. With ongoing discussions between Grayscale and the SEC, as well as positive sentiments from Bloomberg analysts, there is growing optimism about the approval of spot Bitcoin ETFs. The recent changes in joint ETF filings and surveillance-sharing agreements with major exchanges demonstrate efforts to address regulatory concerns. If approved, spot Bitcoin ETFs could provide greater accessibility and legitimacy to the cryptocurrency market, attracting more institutional investors and potentially driving further adoption.
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