With the market maturing, accredited investors are demanding more pathways in the crypto industry. Major institutions have been chasing an approved Bitcoin spot ETF, but the SEC has been dismissive in the past. Now, brokerage firm Bernstein feels that the probability of the SEC approving the spot vehicle is fairly high at this stage.
The SEC has time and again rejected spot BTC ETFs in the past indicating that they do not meet security standards to prevent fraudulent practices. Right now, exchanges are not leaving any stone unturned. A day back, CBOE Global Markets filed amended applications revealing its tie-up with Coinbase on market surveillance.
Grayscale CEO Michael Sonnenshein, acknowledged the efforts of BlackRock, Fidelity, and other asset managers for venturing into the crypto industry. Commenting on BlackRock’s decision to file for a spot in Bitcoin ETF, Sonnenshein said in a recent CNBC interview,
“It’s [it is] a moment of validation. To see literally the largest asset manager in the world publicly commit to advancing their crypto efforts only lends validity to the asset class and the staying power that it has.”
Grayscale’s ETF tangent
In 2022, Grayscale filed an application with the SEC to convert its flagship Bitcoin Trust into an ETF. GBTC has been in dire straits for more than two years. Its shares have been trading at a discount since 2021. Despite the latest recovery, they are underwater by more than 27%. The organization contended that if regulators allowed its GBTC to transition into a Bitcoin Spot ETF, the state of affairs may improve. Yet again, the SEC rejected Grayscale’s application and the company subsequently went on to sue the agency. Commenting on similar lines in the CNBC interview, the Grayscale executive asserted,
“If we’re [we are] successful in that challenge there’s actually billions of dollars in investor capital that would be unlocked through that. So, lot of conviction there… Moving to an ETF structure will give investors that additional protection that they want and deserve.”