In a recent report from CNBC, Coinbase, the largest cryptocurrency exchange in the United States, expressed confidence in the approval of a US-based Bitcoin (BTC) exchange-traded fund (ETF) by the Securities and Exchange Commission (SEC).Thank you for reading this post, don't forget to subscribe!
Coinbase Chief Legal Officer Paul Grewal highlighted that the SEC’s recent court setback in the case of Grayscale’s proposed Bitcoin ETF has paved the way for potential approval in the coming months.
Coinbase eyes Bitcoin ETF approval
Grewal emphasized that Coinbase is optimistic about the approval of ETF applications due to their compliance with existing laws governing financial services. Grewal said major financial institutions have submitted strong proposals, indicating progress in the regulatory landscape.
The recent court ruling against the SEC states that the regulator lacked legitimate grounds to reject Grayscale’s request to convert its GBTC Bitcoin fund into an ETF.
The SEC decided not to appeal the decision within the specified deadline, increasing the chances of a BTC-related ETF getting approved soon.
However, Grewal acknowledged that the final decision rests with the SEC, and he refrained from providing a specific timeline for the approval process.
Nevertheless, Grewal expressed confidence in the SEC’s obligation to fulfill its responsibilities, especially in view of the court’s decision and the need to apply the law impartially.
The launch of a Bitcoin ETF will provide investors with an alternative means of gaining exposure to BTC without having to purchase the cryptocurrency directly from an exchange.
This may be particularly attractive to retail investors seeking Bitcoin exposure without the complexities of owning the underlying asset.
According to the report, Coinbase, being the largest crypto exchange in the United States, would benefit from the possible approval of a BTC ETF. The company’s common stock is held in a portfolio designed to provide investors with crypto exposure.
Legal troubles continue to mount for Grayscale’s parent company
While the recent court decision has strengthened the prospects for a BTC ETF, it is important to note that Grayscale’s bid to convert GBTC into an ETF is not without challenges.
Digital Currency Group (DCG), parent company of Grayscale, along with crypto exchange Gemini and DCG subsidiary Genesis, are facing a lawsuit from the New York Attorney General accusing them of defrauding investors out of more than $1 billion. has been applied.
Despite the ongoing legal issues, Grewal remained positive about the approval of additional Bitcoin ETFs in the future as long as the SEC follows the law and evaluates pending applications fairly.
The report also discusses the recent performance of BTC, which is expected to experience a resurgence in 2023. Bitcoin has bounced back from a significant decline in 2022, with a 72% increase year-to-date.
Factors such as anticipation over the upcoming BTC halving event and investors’ reaction to a potential interest rate policy change from the Federal Reserve have contributed to increased demand for the digital currency.
Ultimately, while trading volumes have declined recently, partly due to lower volatility and less engagement from retail investors in response to challenges from industry players, Grewal expressed optimism that various developments, including criminal trials and harsher regulatory actions, will help investors. And restore consumer interest. Crypto Market.
As the landscape for Bitcoin ETFs evolves, market participants will be closely monitoring the SEC’s stance and any potential regulatory developments that could shape the future of cryptocurrency investment products.
Featured image from Shutterstock, chart from tradingview.com