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The U.S. Securities and Exchange Commission is reportedly not planning to contest the recent court ruling that was in favor of Grayscale Investments. This decision mandates the SEC to reassess the company’s application for a spot Bitcoin (BTC) exchange-traded fund.
Benzinga (among others) is reporting that Reuters has indicated the SEC will NOT be appealing the Grayscale case. pic.twitter.com/yd9BBtRwv5
— Eric Balchunas (@EricBalchunas) October 13, 2023
The SEC’s alleged choice not to challenge the D.C. Circuit Court of Appeal’s ruling was emphasized in an October 13 report from Reuters, which referenced “a source familiar with the matter.”
Bloomberg analysts also anticipate that the SEC will refrain from appealing to the Supreme Court, but they stressed that this does not automatically imply that Grayscale’s application will be approved.
If the reports hold true, the SEC will be required to adhere to the court’s August directive and evaluate Grayscale’s request to convert its Grayscale Bitcoin Trust (GBTC) into a spot Bitcoin ETF.
As per Reuters, the appeals court is expected to issue a mandate detailing how its ruling should be “implemented” by the SEC.
In response to the developments, Bloomberg ETF analyst James Seyffart remarked via X that:
“I do not think they will appeal to the Supreme Court either. Dialogue between Grayscale and SEC should begin next week. Hoping for more info on next steps sometime next week or week after?”
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1. Done deal I guess if this is accurate. No en banc application
2. No. I do not think they will appeal to the Supreme Court either.
3. Dialogue between Grayscale and SEC should begin next week. Hoping for more info on next steps sometime next week or week after? https://t.co/2EayzqeKGq— James Seyffart (@JSeyff) October 13, 2023
Looking ahead, Seyffart indicated that it is probable that “we will find out in the next week (or two)” regarding the deadline for the SEC to either approve or reject Grayscale’s spot BTC ETF application.
If the SEC were to reject the application, Grayscale would then have the option to appeal that decision, potentially prolonging the process further.
Related: Bitcoin price gets new $25K target as SEC decision day boosts GBTC
Currently, approximately seven spot Bitcoin ETF applications are pending a decision from the SEC.
In a separate preceding X post on October 13, Seyffart reiterated his perspective that there is a 90% likelihood that a spot Bitcoin ETF application will be approved in January 2024, specifically the application from Cathie Wood’s ARK Invest.
I've gotten a lot of questions regarding my current view on Spot #Bitcoin ETFs over the last couple weeks. This is the first section of the note I put out yesterday with @EricBalchunas.
TLDR: Our view hasn't changed much https://t.co/dRAm5IsdQf pic.twitter.com/Htsi3n2XxV— James Seyffart (@JSeyff) October 13, 2023
Seyffart and Bloomberg’s senior ETF analyst Eric Balchunas have also previously suggested that there is a 75% chance that an application will be approved in 2023.
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