The news for the first Bitcoin spot ETF in the USA have been rampant for a while. There have been several applications by far, with Grayscale being the closest to it. Of course, the SEC doesn’t sit idly with these applications. It has challenged the existence of a Bitcoin traded exchange fund, even if it doesn’t have the legal grounds for it.
After a second defeat in court, Coinbase’s chief legal officer Paul Grewal says that we’re closer to a Bitcoin spot ETF than ever. The SEC has suffered a major loss recently when a judge ruled that the regulator doesn’t have any basis to deny crypto asset managers after Grayscale asked to turn its GBTC Bitcoin fund into an ETF fund.
A Major Setback
That’s how the SEC’s second court defeat was explained in the media. The Securities and Exchange Commission is notoriously against cryptocurrencies, pushing them aside and asking for court action in many cases. Most recently, a judge ruled in Grayscale’s favor, rejecting SEC’s claims to block the functioning of a new Bitcoin spot ETF.
This has likely paved the way for the first Bitcoin spot ETF in the coming months. The market is already reacting positively to the news, with Bitcoin’s price flying high in the past few days. According to Grewal, crypto companies have stepped up with a robust proposal and major plans for these products and services. They are supposed to be some of the biggest blue chips in financial services. There will most certainly be progress in short order, but no one knows when that might happen. Everyone’s just hoping it’ll be soon.
The SEC rejection in court didn’t just came from any court. It came from the US Court of Appeals. It made it clear that the SEC doesn’t have any basis to reject such applications, so the Commission must now fulfill its obligations.
What’s a Bitcoin Spot ETF?
This is a new term on the crypto market that might confuse new investors. A Bitcoin ETF will give investors a chance to earn BTC without buying it from an exchange. It’s a very attractive solution for investors who want exposure to Bitcoin without owning it. Coinbase will benefit from it, as will Grayscale.
However, Grayscale’s application is a bit shoddy. Instead of creating a new Bitcoin ETF, it wants to turn its Bitcoin GBTC into an ETF. Grayscale is owned and operated by Digital Currency Group and crypto exchange Gemini, as well as DCG’s subsidiary Genesis. Both have been accused of defrauding investors in New York for over $1 billion.
Nevertheless, Grewal thinks this isn’t a major obstacle. Sooner or later, the ETF will be approved. When that happens, the price of Bitcoin should go even higher. On that note, Bitcoin is up by 72% this year and is pushing for a comeback. In the past few days and likely as a result of these news, it has managed to climb back up over $30,000 for the first time in months, and even testing the $35,000 line. We’re eager to see what happens when an eventual ETF is approved.