Written by Matteo Greco, Research Analyst at Fineqia International, a listed digital asset and fintech investment firm.
The SEC will now reevaluate the Grayscale Bitcoin ETF application and issue a new ruling at the appropriate time.Following the court ruling, the market rebounded strongly as BTC rose above $28,000, before returning to a price level of $26,000 that reflects trading prices before the lawsuit was announced. While Grayscale’s win has caused some expected near-term volatility, no decision has yet been made on whether Grayscale or another digital asset manager will be able to list a Bitcoin spot ETF.
With this Grayscale win, Grayscale Bitcoin Trust (GBTC) reached 16% before stabilizing at around 20%. This is the lowest discount rate recorded since early 2022. The narrowing of the discount confirms that investors’ confidence in the possibility of converting ETFs to trusts in the future has increased.
The SEC announced delays related to its decision to reject or approve a Bitcoin spot ETF. Between September 1 and 4, filings from Bitwise, VanEck, iShares, WisdomTree, Invesco, Wise, and Valkyrie met the first deadline. The second deadline is currently scheduled for October 16-19. It is important to remember that there are four deadlines for submitting all documents. The SEC has been allowed and expected to delay its decision three times. The final deadline for all these applications is mid-March 2024.
The SEC’s decision did not cause much movement in the market as it was widely anticipated by all investors and was already priced in. Investors expect the SEC to delay its decision as long as possible, with the final result likely to be delayed until December 2019. Fourth and final deadline.
Unlike the United States, where the battle between service providers and regulators has continued over the past few months, Asia continues to work to create a friendly environment for digital asset businesses. Several countries on the Asian continent have already confirmed their strong commitment to becoming digital asset hubs over the past few months, and the steps taken have confirmed this desire.
Binance, the world’s largest digital asset exchange, launched a Japanese subsidiary in early August. Currently, the exchange allows Japanese customers to trade 34 digital assets, but plans to increase the number of listed assets to up to 100.
Swiss-based cryptocurrency bank SEBA Bank announced last week that it had received in-principle approval from Hong Kong’s securities regulator. SEBA Bank has become the fourth entity to receive support from Hong Kong regulators.
Asia and Europe are seeking to grab a larger share of the digital asset market as recent tensions between service providers and regulators have increased uncertainty in the United States. As we await a final and clear decision on ETF listings and exchange litigation, it is advantageous to see capital outflow from the United States to other jurisdictions.