SEC Rejected Grayscale's Listing Application but Lost Lawsuit
BlackRock and Others Have Applied for Bitcoin Spot ETFs
Market Optimism Drives Bitcoin Price Surge
The U.S. court has ruled that the U.S. financial regulators, who have been blocking the listing of Bitcoin spot exchange-traded funds (ETFs), made an "arbitrary decision" and ordered a reconsideration of the approval. This ruling has sparked expectations that the listing of Bitcoin ETFs could finally proceed, causing the prices of Bitcoin and other cryptocurrencies to surge.
According to CNBC and other outlets on the 29th (local time), the U.S. Court of Appeals for the District of Columbia Circuit ruled that the U.S. Securities and Exchange Commission (SEC) must reexamine the listing application for a Bitcoin ETF filed by cryptocurrency asset manager Grayscale Investments.
Grayscale filed an application with the SEC in 2021 to convert its Bitcoin fund (GBTC) into an ETF. At that time, the Bitcoin fund managed by Grayscale was approximately $40 billion (about 52.8 trillion KRW), making it the largest cryptocurrency-related financial product. However, in June of last year, the SEC rejected Grayscale's application for a Bitcoin spot ETF listing, and Grayscale filed a lawsuit claiming the SEC's decision was unjust.
Judge Neomi Rao stated in the ruling, "The rejection of Grayscale's application was an arbitrary and capricious decision," adding, "The SEC failed to explain why it approved two other Bitcoin spot ETFs but denied Grayscale's case."
Since 2021, the SEC has approved some Bitcoin spot ETFs but has generally maintained a negative stance. This court ruling is expected to inevitably lead to a shift in the SEC's policy direction.
In particular, this ruling has drawn greater attention as it comes at a time when major financial firms such as BlackRock have applied for Bitcoin spot ETF listings, attracting significant market interest. Previously, BlackRock, the largest asset manager in the U.S., had its Bitcoin spot ETF application rejected in June but resubmitted the application after supplementing the documents. Additionally, several asset managers, including Ark Investment managed by Cathie Wood, have applied to launch Bitcoin spot ETFs.
Following the court's ruling and the increased possibility of spot ETF listings, Bitcoin prices surged. According to CoinMarketCap, Bitcoin was trading around $27,900 on the 29th, up 7.6% compared to 24 hours earlier.
The SEC stated, "We are reviewing the court's ruling to determine the next steps." The New York Times (NYT) reported that the SEC could complete its review within 45 days and may file an appeal.
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