When Greyscale Investments earned a favorable federal court ruling against the SEC, it sent Greyscale Bitcoin up by nearly 20%. Bitcoin (BTC-USD) also rallied from $26,000 to $27.720. The rally did not last. BTC closed at below $26,000 over the past weekend.
The appeals panel vacated a decision by the U.S. Securities and Exchange Commission that previously blocked the ETF. Greyscale is free to petition a review. With the discount removed from GBTC and Ethereum (ETH), investors have another means to gain exposure to cryptocurrency.
What’s Next
The SEC delayed its decision on allowing Investco, Fidelity Investments, Bitwise, WisdomTree, and Valkyrie to list a spot bitcoin ETF. Markets reacted immediately by sending BTC-USD lower. The market is overreacting. The SEC needs to reformulate its position on the pending BTC Spot ETF applications.
After the SEC lost a major case, chances are on the rise that the regulator will approve those pending applications. Market participants do not want the risk of holding cryptocurrency in risky platforms. They need ETF instruments instead.
The market already has high-risk ETFs like 2x and 3x bull or bear assets. Volatility ETFs are also risky. They lose value over time and yet they trade on the exchange.
An ETF for a spot bitcoin is a welcome addition to the stock market.
