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Key Insights:

  • Recent SEC court setback boosts prospects for Bitcoin ETF approval, increasing accessibility for investors.
  • Coinbase’s optimism hinges on the SEC’s legal obligation to apply the law neutrally to pending ETF applications.
  • An approved Bitcoin ETF can provide easier access to BTC for retail investors and benefit significant players like Coinbase, 

Recently, Paul Grewal, the Chief Legal Officer of Coinbase, expressed positive sentiments about the SEC’s potential approval of a U.S. Bitcoin ETF during a CNBC interview. This hopeful outlook comes on the heels of the SEC’s unsuccessful attempt to prevent the transformation of Grayscale’s GBTC fund into an ETF.

Recent Court Ruling Shakes Up Expectations

The U.S. Court of Appeals recently delivered a significant blow to the SEC. The court found that the SEC had no valid grounds to decline Grayscale’s GBTC Bitcoin fund conversion into an ETF. Moreover, the SEC missed the appeal deadline last week. Consequently, many experts believe this sets the stage for imminent approvals of bitcoin-related ETFs.

In his conversation with CNBC’s Arjun Kharpal, Grewal stated, 

“I’m quite hopeful that these [ETF] applications will be granted, if only because they should be granted under the law.” 

Furthermore, he emphasized that many firms pushing for these products are financial blue-chips. Hence, this might lead to quicker progress.

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However, Grewal carefully noted that the final decision remains with the SEC. Still, the regulator’s recent setbacks in court lead many to believe an approval is on the horizon.

Why a Bitcoin ETF Matters

A Bitcoin ETF offers a more accessible option for investors to gain exposure to Bitcoin without purchasing it directly from a cryptocurrency exchange. This provides a more straightforward avenue for retail investors looking to enter the world of Bitcoin without needing to hold the digital asset physically.

Besides, Coinbase stands to gain from an approved Bitcoin ETF. Being the U.S.’s biggest crypto exchange, it is frequently included in portfolios aiming for crypto exposure.

Nevertheless, the path for Grayscale’s GBTC conversion has hurdles. New York’s attorney general recently slammed a lawsuit against Digital Currency Group, Grayscale’s parent firm, and its subsidiaries. They face allegations of defrauding 230,000 investors of over $1 billion.

Nevertheless, Grewal remains positive. He said, 

“We think that other ETFs are going to be coming online soon enough as the SEC follows the law and is required to apply the law in a neutral way to the pending applications.”

Bitcoin was trading at $29,474.48 at press time, showing a 2.90% rise in the last 24 hours. Its market cap is $576,737,131,860, with 19,519,100 BTC coins in circulation.

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Tom Blitzer

By Tom Blitzer

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