Grayscale’s Victory Changes SEC’s Approach to Bitcoin ETFs
Gary Gensler, the SEC Chairman, has acknowledged the significance of Grayscale’s legal victory in the approval of spot Bitcoin ETFs. The SEC had previously rejected several spot Bitcoin ETF applications since 2013. However, Grayscale’s victory in August 2023 has prompted the SEC to reconsider its stance on crypto investment vehicles.
The Impact of Grayscale’s Victory on the SEC
Gary Gensler recently stated that the court decision in favor of Grayscale played a crucial role in the approval process of spot Bitcoin ETFs. He emphasized the importance of upholding the rule of law and respecting the courts, stating that considering a new judicial decision allowed them to move forward and was the most sustainable path.
This legal battle began when Grayscale challenged the SEC’s refusal to convert its Grayscale Bitcoin Trust (GBTC) into a spot Bitcoin ETF. Previously, the SEC had rejected numerous similar requests for such products. However, Grayscale’s legal victory forced the SEC to reconsider its position and explore new approaches to regulating these traditional investment vehicles.
Approval of Bitcoin ETFs Does Not Reflect Approval of Bitcoin Itself
Gary Gensler clarified that despite the recent approval of 11 spot Bitcoin ETFs, it does not imply an endorsement of Bitcoin itself. Grayscale Bitcoin Trust (GBTC) recorded approximately $2.3 billion in transaction volume on its first trading day, while the 11 Bitcoin ETFs collectively reached a record-breaking $4.5 billion in transactions. BlackRock’s IBIT holds the second position with over $1 billion in volume on its debut.
