- The SEC has decided not to appeal the court’s judgment in the spot Bitcoin ETF Grayscale vs SEC case
- This means that the commission will have to revisit its decision on rejecting the application to covert GBTC to spot Bitcoin ETF
The United States Securities and Commission (SEC) has reportedly decided to stay away from another legal battle with Grayscale Investments – a leading digital asset management company. According to Reuters’ sources, the report comes hours before the deadline to file for an appeal closes. This means the SEC will be forced to work with Grayscale on its spot Bitcoin ETF application.
Interestingly, this SEC move has had little to no effect on the price of the king coin – Bitcoin [BTC]. According to CoinMarketCap, at press time, Bitcoin was trading at $26,802.61 with a market cap of over $523 billion.
While the coin did breach the $27,000 after the news broke, it failed to hold this ground and has left no traces of significant changes in the past hour or past day. Whereas, the seven-day chart showed a decline of nearly 4%.
SEC versus Grayscale for a spot Bitcoin ETF
Historically, the SEC has been notorious for rejecting any and all applications for a spot Bitcoin ETF. And, this was irrespective of whether the filing was made by a legacy fund manager. However, the game changed this year when investment giant – Blackrock applied for a spot Bitcoin ETF. This move saw a revival of interest with multiple other companies submitting their application as well.
Moreover, the D.C. Circuit Court of Appeals judgment in the case of Grayscale versus SEC has given the market hope of finally seeing an approved spot BTC ETF. In August 2023, the judge ruled that the SEC’s decision to reject Grayscale’s application to convert its GBTC to a spot Bitcoin ETF was “arbitrary and capricious”. The judge also remarked that the SEC “recently approved the trading of two Bitcoin futures funds on national exchanges but denied approval of Grayscale’s Bitcoin fund.”
While the move to not appeal does add renewed hope, the commission still holds the right to reject the application again. However, Grayscale would once again oppose such a decision in court.
Currently, apart from Grayscale’s application, the SEC sits on several spot Bitcoin ETF applications. This includes the applications from Blackrock, Fidelity, Valkyrie, and others. The commission has already delayed making a decision on these applications twice.
