The clock is ticking until this Friday (October 13), when the window will close for the U.S. Securities and Exchange Commission (SEC) to appeal the Circuit’s Grayscale bitcoin Spot ETF ruling As this deadline approaches, the crypto community is abuzz with speculation, predictions, and hopes about what the outcome could mean for the broader digital currency ecosystem.
What will happen on Friday?
Top Bloomberg ETF analyst Eric Balchunas recently shed light on the current situation in a conversation on X (formerly Twitter).
He highlighted the SEC’s departure from its traditional methods, indicating:
The fact that they are actively engaging with issuers in their current filings (via comments, which has never happened before) we think appeal is unlikely and denial is unlikely. Once again we maintain the line of approval probabilities of 75% for the end of the year, a figure that would only increase if we enter January.
Supporting Balchunas’ optimism, his colleague James Seyffart also intervened with: “I don’t think they will appeal. But it’s possible, and even if they did, the SEC would lose. “We will most likely have a better understanding of the next steps.”
The broader crypto community on X has been fervently debating the possible outcomes. Rat Fat, an active user, emphasized inherent uncertainties, noting that the lack of an appeal may not directly translate into an approval for the Grayscale ETF conversion.
Wilson, another user, speculated about the post-deadline proceedings. He theorized that, absent an appeal, the Court could quickly establish a clear timeline, perhaps a 45-day period, for the SEC to conclusively decide on Grayscale’s proposal.
Bloomberg analyst Seyffart agreed with Wilson, arguing that US authorities cannot drag out the decision on a bitcoin spot ETF ad infinitum: “Okay. At some point, the courts or the SEC or someone will say, ‘The SEC will issue an order by the XX/XX deadline’ (45 days, 60 days, 90 days, etc., etc.).”
Broader Implications for a bitcoin Spot ETF
Delving into the roots of this saga, the DC Circuit Court of Appeals passed a unanimous ruling on August 29, 2023 that came down in favor of Grayscale. This was a monumental decision that deemed the SEC’s previous denial “arbitrary and capricious,” particularly compared to its stance on futures-based btc products.
Quickly reacting to this verdict, Grayscale approached the SEC and sent a letter to emphasize its position and initiate timely communication to initiate the launch of a bitcoin spot ETF as soon as possible. But since then there has been silence. Neither Grayscale nor the SEC have commented further on the status of the proceedings.
Notably, the industry’s anticipation of this decision isn’t just about grayscale. The result has broader implications. An SEC approval or non-appeal could open the floodgates for many other bitcoin spot ETF applications, such as those from BlackRock, Fidelity, Bitwise, Ark Invest and Invesco, that are waiting in the wings.
At the time of this publication, bitcoin was trading at $27,696.
Featured image from Shutterstock, chart from TradingView.com
