Greyscale’s legal victory boosts the Spot Bitcoin ETF to 90%
The launch of a spot bitcoin exchange-traded fund (ETF) is approaching after the US Securities and Exchange Commission (SEC) decided not to appeal an order asking it to review a grayscale application to convert a Bitcoin trust into an ETF.
This development significantly increases the chances of SEC approval for spot Bitcoin ETFs, which market observers estimate at 90%.
SEC forgets to appeal the grayscale case
On October 13, the financial regulator decided to challenge an August ruling requiring it to review Greyscale's spot Bitcoin ETF.
Speculation surrounding SEC actions had a significant impact on the decline of Greyscale Bitcoin Trust (GBTC), which reached its lowest level this year by 15.88% since October 13, according to Coinglass data.
Greyscale and the financial regulator have been embroiled in a lengthy legal battle over spot ETF applications.
The firm argued that the SEC's rejection of these applications was “arbitrary and blatant,” emphasizing what it saw as “unfair discrimination” against spot Bitcoin ETF issuers.
However, the situation changed in August when a US court ruled against the SEC. The court repeatedly questioned the SEC's rationale for spot ETF applications when approving futures ETFs.
The SEC's argument stems from the perceived lack of investor protection in spot BTC ETFs. This has led to the rejection of all such applications over the past decade.
Acceptance of Bitcoin ETF reaches 90%
Meanwhile, Bloomberg analysts are more confident about the introduction of spot Bitcoin ETFs in the United States.
According to analysts, there is a 90% chance that the SEC will approve a Bitcoin ETF somewhere. Analysts cited increased ties between the regulator and fund sponsors Arch and 21Share:
“This back-and-forth between the SEC and fund sponsors is standard practice for new startups, but it's the first Bitcoin ETF applications for the space, indicating that the SEC is working to approve Arc's proposal.”
According to BeInCrypto, the analysts revised their estimates by 75% after Greyscale's victory over the regulator in August.
Several asset managers, including BlackRock, have applications pending with the SEC to spot bitcoin ETFs.
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