The world’s largest crypto asset manager, Grayscale Investments, is converting its Bitcoin fund into a Bitcoin spot ETF (an ETF that tracks the actual price of Bitcoin). However, the US financial regulator, SEC, is determined not to grant approval due to concerns about a lack of consumer protection.
Grayscale therefore decided to file a lawsuit against the SEC in June 2022 to eventually get approval for a spot bitcoin ETF. And with success, because according to the latest reports and speculation it seems more and more that Grayscale will win this lawsuit. This would be a huge win for all Bitcoin advocates.
SEC is losing control of the matter
Rumors are circulating that members of the SEC are losing confidence in their chances of winning the case.
The Grayscale team argued that the SEC was making arbitrary decisions. The SEC should have no problem approving a spot bitcoin ETF if it is open to approving bitcoin futures contracts.
The judge also failed to understand the logic of the distinction being made, as bitcoin spot and futures ETFs are both derived from the price of bitcoin.
As Grayscale appears to be winning, the SEC is expected to pave the way for a spot bitcoin ETF or launch an offensive to ban futures bitcoin ETFs as well. This should have been learned from internal sources. So it is not yet certain whether this is true.
Grayscale gains can fuel the bull market
If Grayscale eventually wins the lawsuit and converts its Bitcoin fund into a Bitcoin ETF, it could very well be the catalyst for another cryptocurrency bull market.
Billions of dollars are expected to flow towards the approval of a spot bitcoin ETF as many investors have yet to venture into cryptocurrencies in other ways.
With a spot ETF, actual bitcoins must be bought to support the ETF people buy for all the expected billions to actually flow into the bitcoin market. There is a good chance that this will lead to significant price increases.
Bitcoin is already up more than 70% since early 2023. It’s hard to say if or when Grayscale will win this lawsuit, but for now the outlook is positive.
Source: Btc Direct
Barry Siefert is an accomplished journalist and author at The Nation View. He is known for his expertise in the field of cryptocurrency, and has written extensively on the topic. With a background in finance and economics, Barry has a deep understanding of the underlying technology and market forces that drive the crypto industry.
