SEC could use alternative arguments to reject Grayscale spot Bitcoin ETF, Berenberg says


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  • The US Securities and Exchange Commission could nip Grayscale’s victory in the bud using alternative arguments to reject a spot Bitcoin ETF. 
  • Analysts at Berenberg bank led by Mark Palmer said that the regulator is likely to present concerns about the spot Bitcoin market to support its arguments. 
  • Bitcoin price could lose ground amid increasing pressure from macroeconomic data releases and SEC’s next move after the panel’s ruling.

Prices of Bitcoin, Ethereum and altcoins in the top 30 assets have recently increased,  riding on the back of Grayscale’s win against the US Securities & Exchange Commission (SEC) in its spot Bitcoin ETF application lawsuit.

Two factors are likely to determine the direction of Bitcoin price trend in the short term. The release of US macroeconomic data and the SEC’s next steps in the Grayscale ruling by the Federal Court.

Also read: Bitcoin traders exercise caution ahead of US Core PCE Price Index release

SEC could reject again spot Bitcoin ETFs 

The SEC is likely to come up with alternative arguments to reject the spot Bitcoin ETF application by the asset manager, according to research from analysts at the German investment bank Berenberg cited by CoinDesk.

While the Federal Court asked the SEC to revisit its arguments used to reject Grayscale’s application, it did not compel the regulator to approve the ETF application. The SEC is still in a position to appeal the panel’s ruling and offer arguments supporting its concerns surrounding the spot Bitcoin market.

Analysts at the German Investment Bank said that Coinbase’s involvement in the spot Bitcoin ETF could add to the regulator’s concerns and strengthen its arguments to oppose the approval of such trading product.

Coinbase is embroiled in a lawsuit brought by the US financial regulator, battling charges of operating as an unregistered securities exchange.  

The analysts, led by Mark Palmer, explain in their report that Coinbase’s involvement serves the SEC’s reconfigured arguments to reject spot ETF applications. This development could dampen sentiment among BTC holders and hinder its price in the short term.

Bitcoin price is $27,201 at the time of writing, on Binance. The asset yielded 2.91% gains for BTC holders, over the past week.

Crypto ETF FAQs

What is an ETF?

An Exchange-Traded Fund (ETF) is an investment vehicle or an index that tracks the price of an underlying asset. ETFs can not only track a single asset, but a group of assets and sectors. For example, a Bitcoin ETF tracks Bitcoin’s price. ETF is a tool used by investors to gain exposure to a certain asset.

Is Bitcoin futures ETF approved?

Yes. The first Bitcoin futures ETF in the US was approved by the US Securities & Exchange Commission in October 2021. A total of seven Bitcoin futures ETFs have been approved, with more than 20 still waiting for the regulator’s permission. The SEC says that the cryptocurrency industry is new and subject to manipulation, which is why it has been delaying crypto-related futures ETFs for the last few years.

Is Bitcoin spot ETF approved?

Bitcoin spot ETF has been approved outside the US, but the SEC is yet to approve one in the country. After BlackRock filed for a Bitcoin spot ETF on June 15, the interest surrounding crypto ETFs has been renewed. Grayscale – whose application for a Bitcoin spot ETF was initially rejected by the SEC – got a victory in court, forcing the US regulator to review its proposal again. The SEC’s loss in this lawsuit has fueled hopes that a Bitcoin spot ETF might be approved by the end of the year.


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