{"id":26642,"date":"2023-10-13T20:18:47","date_gmt":"2023-10-13T20:18:47","guid":{"rendered":"https:\/\/isafespend.com\/investing\/bitcoin-etfs-face-a-critical-deadline-what-it-means-for-the-token\/"},"modified":"2023-10-13T20:18:49","modified_gmt":"2023-10-13T20:18:49","slug":"bitcoin-etfs-face-a-critical-deadline-what-it-means-for-the-token","status":"publish","type":"post","link":"https:\/\/isafespend.com\/?p=26642","title":{"rendered":"Bitcoin ETFs Face a Critical Deadline. What It Means for the Token."},"content":{"rendered":"
\n
\n

<\/p>\n

\n
<\/div>
\n

Crypto investors will soon get a signal from the Securities and Exchange Commission on whether a spot Bitcoin exchange-traded fund could soon come to market.<\/h4>\n


\n Dramstime
\n <\/span>
\n <\/figcaption><\/figure>\n<\/p><\/div>\n

Crypto investors will soon get the latest smoke signal from the Securities and Exchange Commission on whether a spot Bitcoin exchange-traded fund could soon come to market. The decision could have big ramifications for the token.<\/p>\n

The SEC faces a midnight Friday deadline to challenge its loss in court to Grayscale Investments, which has sought for years to convert the
\n Grayscale Bitcoin Trust
\n (ticker: GBTC) into an ETF.<\/p>\n

\n

The trust right now has about $16.6 billion under management but trades like a closed-end fund with a price that can deviate significantly from the value of its underlying assets. As of Wednesday\u2019s close, GBTC\u2019s price, at $20.07, was about 16.5% below the price of the Bitcoin it holds.<\/p>\n

Scores of hedge funds and other investors have bet the discount will close, potentially netting them billions of dollars, if the trust is allowed to convert into an ETF and to follow the usual share redemption and creation process that keeps prices aligned.<\/p>\n

The decision could also have ramifications for Bitcoin itself. Fidelity,
\n BlackRock
\n (BLK),
\n Invesco
\n (IVZ), and other firms have applied to launch Bitcoin ETFs of their own. If the SEC lets those funds come to market, some analysts have predicted that billions of dollars could flow into the token as investment advisors and other institutions gain a way to buy it in a product they\u2019re familiar with.<\/p>\n

It\u2019s unclear whether the SEC, which has consistently denied those applications, is about to capitulate now. In a hearing last month, SEC Chair Gary Gensler said the agency was \u201cstill considering\u201d the appellate court decision.<\/p>\n

The agency didn\u2019t respond to a request for comment on Thursday.<\/p>\n

In the decision, which came in August, a panel of judges in the U.S. Court of Appeals for the D.C. Circuit ruled that the SEC acted arbitrarily and capriciously when it rejected Grayscale\u2019s bid to convert GBTC into an ETF. The SEC had said Bitcoin-trading platforms had insufficient surveillance for fraud and manipulation, but Grayscale argued there was no reason to draw a distinction between spot Bitcoin ETFs and exchange-traded products based on Bitcoin futures, which the SEC has already approved.<\/p>\n

The ruling kicked off a 45-day period during which the SEC could choose to ask for an \u201cen banc\u201d hearing in front of all of the appellate court\u2019s judges. That deadline expires at midnight on Friday. In theory, the agency could later ask for an appeal at the Supreme Court even if it declines to file for an en banc hearing.<\/p>\n

The court\u2019s decision, if put into effect, would vacate the SEC\u2019s rejection, sending the application back to the agency.<\/p>\n

The agency could still reject Grayscale\u2019s bid on grounds that weren\u2019t raised in court. It\u2019s unclear how quickly the agency would have to make that decision, and Grayscale\u2019s attorneys in a letter last month argued that the deadline to make such a determination has long since expired. To convert the fund, Grayscale would also need to file and get approvals for other aspects of the application.<\/p>\n

A Grayscale spokeswoman in a comment to Barron\u2019s<\/em> said that the firm is operationally ready to convert GBTC into an ETF as soon as it gets approval to do so.<\/p>\n

Given the SEC\u2019s vehement opposition to ETFs in the past, it wouldn\u2019t be surprising if the agency finds a way to put off the products again, but this is a saga that finally seems to be nearing a conclusion.<\/p>\n

Write to Joe Light at joe.light@barrons.com<\/p>\n<\/p><\/div>\n<\/div>\n

Read the full article here<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

Crypto investors will soon get a signal from the Securities and Exchange Commission on whether a spot Bitcoin exchange-traded fund could soon come to market. Dramstime Crypto investors will soon get the latest smoke signal from the Securities and Exchange Commission on whether a spot Bitcoin exchange-traded fund could soon come to market. The decision<\/p>\n","protected":false},"author":1,"featured_media":26643,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[49],"tags":[],"class_list":{"0":"post-26642","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-investing"},"yoast_head":"\nBitcoin ETFs Face a Critical Deadline. 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