The SEC may prefer to give BlackRock the approval because of its reputation.
According to some Bloomberg analysts, BlackRock has a 50% chance of getting approval for its spot Bitcoin Exchange Traded Fund (ETF) from the Securities and Exchange Commission (SEC). On the other hand, they also speculated that Grayscale has a 70% chance of winning its ongoing legal case against the regulator.
Eric Balchunas made the comment about the two companies in a tweet after Elliott Stein, a senior litigation analyst for Bloomberg Intelligence, made some comments about them. In his statement, Stein mentioned that the odds for Grayscale increased from 40% to 70% after the last oral argument. According to him, it looks like the three judges were siding with Grayscale.
Another reason we give spot bitcoin ETF approval 50% chance is our senior legal analyst @NYCStein gives Grayscale a 70% chance of winning case against SEC, who could approve BlackRock’s ETF as way to save face using trusted ‘adult’ TradFi cos & stick it to Grayscale via @JSeyff pic.twitter.com/pHydOcpuQo
— Eric Balchunas (@EricBalchunas) June 27, 2023
The Grayscale legal issue with the SEC started last year after the regulator rejected its proposal to offer ETFs. With the outcome of the last court proceeding, Elliott thinks that the SEC could be preparing for a loss and looking for ways to reduce its effect or completely soften it by approving the Grayscale Spot Bitcoin ETF application before the court makes the final decision.
“Grayscale has a 70% chance of winning its lawsuit against the SEC over the company’s bid to convert the Grayscale Bitcoin Trust (GBTC) to a Bitcoin ETF, we believe,” Stein wrote.
For BlackRock, the SEC may prefer to give it approval because of its reputation. The commission may prefer to consider a reputable traditional firm like BlackRock for ETF approval instead of Grayscale. Analysts say this gives the investment advisory company a 50% chance of getting its filing approved.
Companies and Investors Are Looking into Bitcoin ETFs
Many companies have been applying to offer crypto ETFs, making it a trending topic in the crypto industry. If many of them get the approvals they seek, the digital asset market will be exposed to large companies and their clients. This could be positive for the crypto industry.
Even though the outcome of Grayscale’s case is not yet evident, the Grayscale Bitcoin Trust (GBTC) has continued to rise in price. The asset now sells for $19.47, breaking the $19.19 high it has on June 23. The price also represents the highest price it has had since May 2022.
Looking at the price of many other cryptocurrencies, it is obvious that many of them are far below their highest highs, and those that are doing well can only be said to be recovering from the effect of the elongated bear market. However, the price rise still shows investors’ positive sentiments toward the product. The SEC’s approval may push the price higher in the short term.