Court Mandate Requires SEC to Reevaluate Grayscale’s Bitcoin ETF Application
Grayscale, a major player in the cryptocurrency industry, has achieved a significant victory in its legal battle against the U.S. Securities and Exchange Commission (SEC). The U.S. Court of Appeals for the D.C. Circuit has issued a directive to the SEC, compelling them to reassess Grayscale’s spot bitcoin exchange-traded fund (ETF) application. This development puts the SEC in a position where they must decide whether to approve Grayscale’s proposal or provide alternative grounds for rejection.
SEC Faces Multiple Bitcoin ETF Applications
In addition to Grayscale’s application, the SEC is also tasked with reviewing nearly a dozen other spot bitcoin ETF registration requests. Some of the heavyweight financial institutions behind these applications include Blackrock, Fidelity, Invesco, and Franklin Templeton. Furthermore, the Depository Trust & Clearing Corporation (DTCC) recently added the Ishares Bitcoin Trust to its catalog under the ticker “IBTC.” These events have contributed to a surge in bitcoin’s value, with its price nearing $31,800.
GBTC Shares Experience Decreased Discount
As for Grayscale’s Bitcoin Trust (GBTC), its shares have seen an increase in value compared to its net asset value (NAV). Previously experiencing a 48% discount from its NAV, it has now decreased to just 11.03% as of October 20, 2023.
Hot Take: SEC at a Crossroads with Grayscale’s Bitcoin ETF Application
The recent court mandate urging the SEC to reevaluate Grayscale’s bitcoin ETF application places the regulatory agency in a critical position. They must carefully consider whether to approve the proposal or find new reasons for rejection. With other major financial institutions also vying for approval, the SEC’s decision will have significant implications for the future of bitcoin ETFs in the United States. The recent surge in bitcoin’s value and the decrease in GBTC’s discount highlight the growing interest and potential profitability of cryptocurrency investments.
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