Bitcoin Sentiment Positive as Multiple BTC ETFs Hitting Market

Pathik Bhattacharya
Pathik Bhattacharya Published on September 05, 2023 06:39 AM

JP Morgan analysts predict a wave of Bitcoin exchange-traded funds (ETFs) following Grayscale's recent legal victory against the SEC.

Bitcoin Sentiment Positive as Multiple BTC ETFs Hitting Market
Source: Unsplash

JP Morgan analysts led by Nikolaos Panigirtzoglou argue in a new note that Grayscale's trial victory over the SEC has prepared the way for a swarm of Bitcoin ETFs.

They argue that the SEC should reconsider authorising a futures-based Bitcoin ETF in order to prevent Grayscale Bitcoin Trust (GBTC) from being converted into a spot ETF. Analysts, however, believe that this situation is improbable since it would be exceedingly disruptive and embarrassing for the SEC.

JP Morgan analysts state, "[The delays applied to Bitcoin ETF decisions] likely points to approval of multiple spot bitcoin ETF applications at once rather than granting a first-mover advantage to any single applicant."

They further note that even if Bitcoin spot ETFs were approved, they might not lead to substantial price increases for Bitcoin or the overall crypto market. They point out that similar spot Bitcoin ETFs have been available in Canada and Europe for some time but haven't garnered significant investor attention.

Grayscale Win Over US SEC Brings Hopes for Bitcoin

Grayscale, the manager of the world's largest Bitcoin fund, has been locked in a legal battle with the SEC over its request to convert its investment vehicle into an ETF. Initially, the SEC rejected Grayscale's proposal, citing concerns about investor protection against fraudulent and manipulative practices.

However, Grayscale recently secured a significant victory when a panel of three federal judges in Washington overturned the SEC's decision, allowing Grayscale to proceed with the initiation of a spot Bitcoin ETF. This decision had a positive impact on the crypto market, boosting BTC and crypto prices.

The US Court of Appeals for the District of Columbia Circuit ruled in favour of Grayscale, deeming the SEC's prior rejection of the company's Bitcoin spot ETF proposal as "arbitrary and capricious." The court recognized that Grayscale had presented substantial evidence to support the similarity of their offering to existing Bitcoin futures ETFs, which had already gained SEC approval.

Bitcoin Stabilizes Amidst Regulatory Uncertainty

Bitcoin has traded within a tight range of $25,800 to $26,000. This follows a price spike last week when Bitcoin briefly surged above $28,000 after a federal appeals court ordered the SEC to review its rejection of Grayscale Investments' attempt to convert its GBTC into an ETF.

Bitcoin retreated as the SEC delayed key ETF decisions expected on Friday, tempering traders' hopes of a long-term recovery. Regulatory and macroeconomic uncertainties continue to leave investors in suspense.

JP Morgan analysts anticipate that the SEC may now be compelled to approve multiple spot Bitcoin ETF applications from various asset managers following Grayscale's legal win. The court's reasoning, which highlighted the similarity in risk factors between futures and spot products, could serve as a catalyst for broader ETF approvals.

Bitcoin Price Analysis

As per CoinStats, Bitcoin is currently trading at $25,720.86, down -0.98% in the previous 24 hours, with a live market size of $501 billion. It has a circulating supply volume of 21,000,000 BTC coins and a maximum supply volume of 21,000,000, with a 24-hour trading volume of $11 billion.

bitcoin price chart

Source: CoinStats

Bitcoin is trading towards the bottom of the broad range that spans $24,800 to $31,000. When the price trades within a range, bulls often buy near the support and sell near the resistance.

The $24,800 level will see a fierce battle between bulls and bears. If this level breaks away, the selling will likely escalate, and the BTC/USDT pair will likely fall to the critical support level of $20,000. A tiny support level of $24,000 exists, but it may not last long. 

Another possibility is that the price rises from where it is now. If bulls break above the $26,833 barrier, the pair might accelerate to the 50-day SMA ($28,221).

btc price chart

Source: TradingView


In conclusion, Grayscale's victory sets the stage for potential regulatory changes that may facilitate more Bitcoin ETFs in the future, although the immediate market impact remains uncertain amidst ongoing regulatory and macroeconomic challenges.


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