Grayscale Asset Manager has prevailed in its long-running dispute with the US Securities and Exchange Commission (SEC).
Grayscale Investments, the world's largest digital asset manager, has won a major victory in its quest to convert its Bitcoin Trust (GBTC) into a spot Bitcoin exchange-traded fund (ETF).
A three-judge panel of the U.S. Court of Appeals for the D.C. Circuit on Tuesday vacated a decision by the Securities and Exchange Commission (SEC) that blocked the ETF. The court found that the SEC had failed to adequately explain why it had approved two bitcoin futures ETFs but not Grayscale's proposed spot ETF.
Grayscale's Bitcoin Trust (GBTC) could be turned into a spot Bitcoin ETF as the SEC is directed to consider the application. The judge stated in the hearing that:
"The Commission failed to adequately explain why it approved the listing of two bitcoin futures ETPs but not Grayscale’s proposed bitcoin ETP," the judges wrote in their opinion. "In the absence of a coherent explanation, this unlike regulatory treatment of like products is unlawful. We therefore grant Grayscale’s petition for review and vacate the Commission’s order."
The ruling is a major win for Grayscale and for the broader cryptocurrency industry. It is the first time that a court has found that the SEC's treatment of bitcoin ETFs is discriminatory.
The ruling could also pave the way for other spot bitcoin ETFs to be approved by the SEC. Several other companies, including BlackRock and Fidelity, have filed applications for spot bitcoin ETFs.
The Grayscale ruling is a significant development in the ongoing debate over the regulation of cryptocurrencies. It is a sign that the SEC is starting to take a more favourable view of the asset class.
The ruling is also a victory for investors who have been eager to gain exposure to Bitcoin through an ETF. Spot bitcoin ETFs offer a number of advantages over other ways to invest in bitcoin, such as lower fees and greater liquidity.
The SEC has 45 days to appeal the ruling. However, it is unlikely that the agency will do so, as it would be a difficult case to win.
As per CoinStats data, Bitcoin is currently trading at $27,310.53, up 4.55% in the previous 24 hours, with a live market size of $532 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 $62B.
The Grayscale ruling is a major step forward for the cryptocurrency industry. It is a sign that the SEC is starting to recognize the legitimacy of Bitcoin and other cryptocurrencies. The ruling is also a victory for investors who have been eager to gain exposure to Bitcoin through an ETF.