What happens if the SEC doesn’t appeal the Grayscale Spot Bitcoin ETF decision? Cryptocurrency scrgruppen
The US Securities and Exchange Commission will soon reach a deadline to appeal a court decision that ruled in favor of Grayscale Investments, forcing the regulator to review the fund manager’s application for a spot Bitcoin (BTC) fund.
While many observers do not believe the securities regulator will attempt to appeal the court’s decision, analysts say there are still ways for the SEC to delay approval of Grayscale’s instant Bitcoin ETF transfer.
On October 13, the SEC must either appeal the D.C. Circuit Court of Appeals’ decision to the U.S. Supreme Court, ask the appellate court to reconsider its ruling, or follow the court’s August order and review Grayscale’s bid to change the Grayscale Bitcoin Trust (GBTC). To the spot Bitcoin ETF.
On October 12th mail In response to an X user’s question, Bloomberg ETF analyst Eric Balkunas said an appeal was unlikely, though other hurdles were likely.
“We believe [an] Appeal is a long shot […] But there’s always a chance something else could happen.”
Meanwhile, in a separate post, fellow Bloomberg ETF analyst James Seyphart said the SEC’s attempt to deny on new grounds was unlikely and “extremely difficult” but that it might “find ways to continue delaying.”
Not officially. The SEC could try to deny it on new grounds, but… @Eric Balchunasmyself, @NYCStein, @SGJohnson, @Nate Geraci Many others said. It would be very difficult to thread the needle and we see that as unlikely. They can find ways to continue the delay through IMO.
– James Seyff (@JSeyff) October 12, 2023
September memo from law firm Ropes & Gray to caution GBTC’s request for review could be sent back to the SEC, giving the regulator another opportunity to reject it on a different basis.
“In this scenario, the same new denial could be subject to another appeal by GBTC to the DC Circuit,” the company wrote.
Another delay scenario, according to Ropes & Gray, is that if the NYSE had to file a new application to list GBTC – it could take up to eight months for the SEC to reach a decision on the ETF.
Related: House committee chairman threatens SEC chief with subpoena, but not on cryptocurrencies
Currently, there are at least seven applications for spot Bitcoin ETFs before the regulator for approval.
Although all were submitted to the regulator earlier in 2023, all faced delays and rejections from the SEC leaving deadlines for final approval for most of them in March 2024 or later.
However, most eyes are on Grayscale’s instant Bitcoin ETF transfer app because if the SEC approves it – the regulator may have a hard time finding reasons to kill other apps.
The probability of a spot Bitcoin ETF getting approved this year is 75%, according to Bloomberg analysts who updated the odds after Grayscale won in court. The odds jump to a 95% chance of approval by the end of 2024.
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