A few days ago, the U.S. Court of Appeals for the D.C. Circuit ruled in favor of digital asset management company Grayscale Investments in its lawsuit against the Securities and Exchange Commission (SEC).
The court ordered the agency to review its rejection of Grayscale’s application to turn its flagship Grayscale Bitcoin Trust fund (GBTC) into a spot Bitcoin exchange-traded fund (ETF). This caused an uproar in the community as crypto assets, including bitcoin (BTC), surged with glee, and GBTC narrowed its discount to less than 20%.
Grayscale sued the SEC in June 2022 after the agency rejected its application filed in October 2021 despite multiple delays. The Commission had claimed that the asset manager failed to disclose how it would prevent market manipulation but approved multiple futures ETFs of a similar nature.
However, the court said the SEC’s arguments were insufficient, insisting that the agency’s reasons for favoring futures ETFs over spot products were unreasonable.
What Crypto Experts Are Saying
Yamina Sara Chekroun, an experienced corporate attorney and the head of Legal U.S. of Ramp, told CryptoPotato in a statement that the court’s decision be applauded as a positive step towards the potential for a spot ETF in the future, although the SEC could still file an appeal.
Chekroun said the SEC’s power to regulate the crypto space is “slowly being chipped away,” as seen in its case against Ripple Labs and XRP. Arguments about Congress not granting the Commission the power to regulate through enforcement are beginning to come up, and they may have influenced the recent decisions by the courts.
Nevertheless, Chekroun added that the ruling indicates that the crypto industry has leaders ready to defend access to digital asset products.
A Favorable Development for Regulations
Furthermore, Joonatan Lintala, CEO of the decentralized social app Phaver, stated that the Grayscale ruling is a “favorable development” for regulations that safeguard investors instead of imposing restrictions. While ETFs may not be investment material for every retail user, approving one would make blockchain technologies “more palatable to mainstream audiences.”
Andrey Stoychev, project manager at crypto exchange Nexo, opined that BTC’s rally after the win was a “vital boost in morale” for investors after the asset had one of its worst weeks since March. However, he speculated that the uptick would not be a straight upward spiral into the next bull market, and this is evident as BTC has erased all of its gains from the euphoria of Grayscale’s victory.
Binance Free $100 (Exclusive): Use this link to register and receive $100 free and 10% off fees on Binance Futures first month (terms).
PrimeXBT Special Offer: Use this link to register & enter CRYPTOPOTATO50 code to receive up to $7,000 on your deposits.
The post appeared first on CryptoPotato
