The court’s verdict in the Grayscale case could bring the final approval of the spot Bitcoin-ETF, though it is unlikely to alter the rules of the game for the crypto market. JPMorgan analysts concluded as much, writes CoinDesk.
On August 29, a U.S. court granted the motion for Grayscale Investments. The appellate panel ordered the Commission to reconsider its decision.
In June, the asset manager filed suit against the regulator over the refusal to convert GBTC into an ETF. The company sent the conversion application to the SEC in October 2021.
JPMorgan analysts believe that after the verdict the agency will have little choice but to approve several applications for launching spot Bitcoin-ETFs. They noted the court described the SEC’s denial as “unlawful and arbitrary.”
According to the statement, fraud and manipulation in the spot market pose the same risk to both futures and spot products, because they are closely intertwined. Consequently, there is no basis to allow Bitcoin futures ETFs while banning spot ETFs, the analysts noted.
To maintain its position on the GBTC conversion, the SEC would have to withdraw approvals for futures-based ETFs tied to digital gold, which is unlikely, as it would be discouraging and damaging [to its reputation], according to experts.
JPMorgan doubts that a change in the regulator’s stance on spot Bitcoin ETFs will materially affect the crypto market given the low interest in the product in jurisdictions where they have already been allowed.
Analysts at Bloomberg James Seyffart and Eric Balchunas raised the probability of launching similar products in the United States by the end of 2023 to 75%.
Earlier, former SEC chairman Jay Clayton called the inevitable approval of spot Bitcoin ETFs.