Home
News
- 1 Grayscale won against the SEC as the US court supported the Bitcoin fund’s argument.
- 2 Grayscale’s win put Bitcoin in a strong position as it is trading above $28,000.
Grayscale marked a victory against the Securities and Exchange Commission (SEC) as the US court supported the Bitcoin fund’s argument. The court made comments on the enforced actions of the regulatory agency. The Bitcoin trust was anticipating a spot Bitcoin ETF which now seems possible following the court’s judgment. The broader crypto industry is optimistic following the ruling and it is reflected in the prices of major cryptocurrencies.
During the court proceeding on August 29th, Tuesday, the United States Court of Appeals for the D.C. Circuit called out the SEC’s failure to provide adequate reasons behind rejecting the ETF application from Grayscale. Regardless, the regulator has approved two Bitcoin futures ETFs.
Citing the treatment of cryptocurrency offerings and services stifling their growth without concrete reasons, the court called it “unlawful.”
Now that the court sided with the biggest Bitcoin fund manager company which was seeking the exchange-traded funds, the crypto industry assumes the road ahead for the investment vehicles will be easier. This results in the anticipation of Bitcoin spot ETFs from traditional finance giants like BlackRock and Fidelity to get regulatory approval.
Bitcoin Price Saw Uptick Following Grayscale Win
As a result, the price of the biggest cryptocurrency Bitcoin (BTC) rose above the psychological resistance of $26,000. With this coming into the picture, Bitcoin price was trading above $28,000 following Grayscale’s win against SEC news.
The price of Bitcoin, however, settled with time after marking over 6% increase in a day. Currently, it is trading at $27,200 falling 1% in the last 24 hours.
Grayscale filed the lawsuit against the SEC in July 2022 in the United States court following the dismissal of an application to convert its flagship Bitcoin fund, Grayscale Bitcoin Trust (GBTC), into an ETF.
The SEC stated Grayscale’s failure to answer the questions and resolve the concerns around the potential market manipulation and investor protection.
Grayscale’s Venture into the Bitcoin Funds Space
The Bitcoin fund came into existence in 2013 and is the largest of its own at present. By August 2022, the fund was reported to have over 639,696 Bitcoin (BTC) under management.
GBTC was created as a traditional investment vehicle, according to the fund manager, and it was not an ETF. However, its working model resembles quite a lot with the physically backed ETFs like SPDR Gold Trust.
Grayscale Win Reignites Debate Around ETFs
The issue of Bitcoin ETFs is among one of the hot topics in the crypto industry. Even after multiple efforts from various entities, only a handful of such Bitcoin investment vehicles got approval from the SEC. Out of these approved funds, it only counts Bitcoin futures ETFs and no Bitcoin spot ETF.
Despite the rejections from the regulator, major TradFi players filed with the SEC for the spot Bitcoin ETF offerings. As mentioned earlier, it includes the biggest asset fund manager, BlackRock, and later it was followed by Fidelity, Invesco, and Valkyrie-like other prominent players.
Stepping in of these major players in the space was already pushing up the crypto assets price and anticipation of first spot bitcoin ETF, the win of Grayscale is likely to act as a catalyst to boost the process.
Steve Anderson is an Australian crypto enthusiast. He is a specialist in management and trading for over 5 years. Steve has worked as a crypto trader, he loves learning about decentralisation, understanding the true potential of the blockchain.
