Yesterday, the D.C. Circuit Court ruled in favor of Grayscale Investments, effectively reversing the SEC’s previous rejection of Grayscale’s bitcoin spot ETF proposal, in a huge blow to the bitcoin industry. change. The decision opens a new chapter in the long-running saga of the bitcoin spot ETF, with experts speculating about various timelines and outcomes.
Bitcoin Spot ETF Timeline Expectations
Jake Chervinsky, Chief Policy Officer, Blockchain Association, describe The ruling was “significant,” emphasizing how rarely the Federal Circuit has found agencies like the SEC to have violated the Administrative Procedure Act (APA). “The D.C. Circuit firmly rejected the SEC’s contention that Grayscale’s ETF proposal was not ‘designed to prevent fraudulent and manipulative acts and practices,'” Chervinsky said.
He also noted that the court did not order the SEC to approve the proposal, but instead requested a review of Grayscale’s proposal based on the court’s ruling. Chervinsky speculates on two possible scenarios for the SEC’s next move.
One theory is that the SEC may find another reason to reject the proposal, given the “extreme hostility towards cryptocurrencies from the SEC leadership.” Alternatively, the SEC might see this as a semi-graceful exit from its anti-ETF stance, especially as the traditional financial sector prepares to launch a Bitcoin ETF under political pressure. A number of other issuers have also proposed ETFs this year, including Blackrock, while Larry Fink has thrown a punch at DC. Therefore, the lawyer believes that:
The only question is whether the SEC wants to make itself more miserable. Believe me, if there is one more denial, there will be another lawsuit. I strongly recommend the SEC to choose early. let’s see.
James Seyffart, ETF Analyst, Bloomberg Intelligence proved The significance of the ruling is that “this is a complete condemnation of all SEC spot bitcoin ETF rejection orders.” Seyffart emphasized that the court did not give a clear timetable for the SEC’s next decision.
“My initial thought was a 45-day or 60-day deadline, but there’s nothing here,” Seyffart said. However, he noted that the SEC has 45 days to propose a full hearing, which would involve all 17 judges on the court, rather than the original panel of three judges.
The Bloomberg analyst also outlined two main options for the SEC if it still wants to block the listing of a spot bitcoin ETF: either delisting the bitcoin futures ETF or refusing to list for new reasons that may be related to custody. Or billing issues, which have been an issue. Focus of SEC Staff Accounting Bulletin 121 (SAB 121).
CEHV partner Adam Cochran added another layer to the timeline speculation. He referred to the SEC’s pending decision on six other bitcoin spot ETF applications, with Bitwise due to file on Sept. 1 and BlackRock, Fidelity, and others due to file on Sept. 2. submit the application.he pointed out:
Some people are exaggerating, thinking that Grayscale’s decision means that the ETF has received a large number of approvals this Friday. That may not be the case, my hunch is we’re still looking at the late October/November approval timeline unless the SEC appeals, in which case next spring.
In conclusion, while the court ruling is a major victory for Grayscale and the broader crypto community, it does not guarantee immediate approval for a bitcoin spot ETF. Affected by legal, political and market pressures, the SEC now faces a series of complex choices.
At press time, BTC was trading at $27,466, up 5.3% over the past 24 hours.
Featured image via Grayscale, chart via TradingView.com