The Commission of United States Stock Market (SEC) You will probably have no choice but to approve multiple ETF applications from bitcoins in cash after the victory of grayscale in his case against the SEC, according to JPMorgan.
Grayscale’s victory means the SEC would have to retroactively withdraw its earlier approval of bitcoin ETFs based on futures to defend his refusal of Grayscale’s proposal to convert his bitcoin trust fund into an ETF, but such a move would be “highly damaging and embarrassing for the SEC” and appears unlikely, the JPMorgan analysts wrote.
Therefore, it “seems more likely that the SEC will be forced to approve applications for spot bitcoin ETFs that are still pending from several asset managersincluding Grayscale’s,” the analysts noted.
Grayscale’s bid for the Bitcoin ETF
Last week, a federal court ruled that the SEC must review its rejection of the attempted grayscale to convert the Grayscale Bitcoin Trust (GBTC) in an ETF.
The court ruled that there was no justification for the SEC to allow ETFs based on bitcoin futures but will deny spot bitcoin ETFs because fraud and manipulation in the bitcoin spot market pose a similar risk to both futures and spot products, as the bitcoin spot market and the bitcoin futures market CME bitcoin are closely correlated. Therefore, the rkick out of the sec to Grayscale’s proposal was “arbitrary and capricious” because the agency failed to explain its different treatment of similar products, the court ruled.
The SEC said it would delay decisions on spot bitcoin ETFs proposed by several firms, including BlackRock, Fidelity and Invesco, until at least mid-October. This postponement “likely points to the approval of multiple spot bitcoin ETF applications at once, rather than granting a first-mover advantage to a single applicant,” the JPMorgan analysts said.
Bitcoin ETFs: How Approval Would Impact Investors
“This could be beneficial for investors since it would allow more competition in terms of ETF commissions. Grayscale will likely face even more pressure to cut fees if its fund wins approval to become the world’s largest spot bitcoin ETF,” the analysts added.
While Grayscale’s victory brings eventual approval of spot bitcoin ETFs closer, such approval is unlikely to be a game changer for the cryptocurrency market, analysts reiterated.
In July, analysts noted that the bitcoin ETFs Cash have been around in Canada and Europe for some time, but have failed to arouse significant interest among investors. Exits from gold ETFs over the past year have also not helped equity funds. bitcoins in general, including futures ETFs, the analysts reiterated. Also, while spot bitcoin ETFs have some advantages over forward bitcoin ETFs, those advantages are “rather marginal.”
Source: Ambito
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