Thursday, October 5, 2023

Grayscale Hopes for BTC ETF Approval


Cryptocurrency regulators and financial institutions have consistently adopted a hard stance against these digital assets.

Many people predict that the SEC will approve a Bitcoin spot exchange-traded fund (ETF) in the near future.

Only a Matter of Time

Michael Sonnenshein, the CEO of Grayscale Investments, is one such believer. During a recent interview, he expressed his optimism for the future.

The Securities and Exchange Commission recently approved the Teucrium Bitcoin Futures Fund’s application, which is the major basis for this optimism (SEC). Unlike most other Bitcoin futures funds, Grayscale submitted the fund’s application under the Securities Act.

According to crypto specialists, the ETF’s revised structure may allow it to utilize in the United States. Surprisingly, it would be a significant step forward for the cryptocurrency community. Several countries, including Brazil and Canada, have already approved the fund. However, because to worries about fraud and manipulation, the SEC has rejected all suggestions.

According to Grayscale Investment CEO Sonnenshein, Act products offer various protections that products do not have, according to the SEC. However, those safeguards never addressed the SEC’s concerns about the underlying bitcoin market and the risk of fraud or manipulation.

The certification of a 33 Act product by Teucrium, according to Sonnenshein, has demolished the premise that the value of bitcoin futures contracts. This connects to the underlying spot markets. He went on to say that the Securities and Exchange Commission (SEC) could have broken the Administrative Procedure Act (APA). If it couldn’t tell the difference between futures and spot markets, that is.

Regulatory Concerns

An expert stated last week that he did not believe an ETF for bitcoin will approve in the foreseeable future. He stated that unregulated crypto spot exchanges have raised concerns among US officials. They also pointed out that proponents of crypto ETFs have yet to refute worries about fraud and manipulation.

He predicted that the agency would continue to reject new applications for exchange-traded fund approval in the future.

According to Bloomberg Intelligence experts, the government could approve a bitcoin exchange-traded fund by mid-2023. It would be due to a planned rule change that would allow for the regulation of bitcoin exchanges.

Waiting for Approval

Grayscale Investments is still waiting for a response from the United States. The Securities and Exchange Commission will grant its request to convert its Bitcoin Trust into an exchange-traded fund (ETF). The firm anticipates receiving a response by July; otherwise, it will file a lawsuit.

Many investors have been frustrated by the SEC’s failure to authorize a bitcoin exchange-traded fund. Over 80% of advisors stated they would prefer to invest in a spot bitcoin exchange-traded fund rather than one based on futures in 2022.

According to a recent survey, over 70% of financial advisors would be more comfortable investing in cryptocurrencies if a spot exchange existed.

Investors might watch the price of Bitcoin immediately using a spot exchange-traded fund. It would also cover a bigger market than a futures-based fund. The Securities and Exchange Commission has yet to approve a bitcoin ETF, despite several petitions from the industry. It’s also worth mentioning that investors are still holding their breath.

Even if an exchange-traded fund (ETF) for GBTC is approved, it must appeal in order to attract investors. Despite a number of rallies last year, GBTC has been losing ground. Sonnenshein believes that transforming GBTC to an ETF will allow it to reach its full potential. He does believe, however, that investors will gain from the stock’s long-term potential.

Ivan Cruz
Ivan Cruz
Ivan Cruz is a writer for Cryptoconstellation. He has his Masters in Applied Research in Economics & Business. Ivan has been trading crypto for the past 7 years himself and feels it is his duty to bring you all the latest news.

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