Bitcoin prices rose more than 10% today after a federal appeals court forced the U.S. Securities and Exchange Commission to reevaluate its prior decision to reject Grayscale’s attempt to convert its bitcoin trust to a spot exchange-traded fund (ETF).
The world’s most prominent digital currency flirted with the $35,000 level earlier tonight, according to BTC/USDT Coinbase data provided by TradingView.
At this point, it had climbed over 12% in a matter of hours.
Bitcoin logged these impressive gains after markets responded to news that a U.S. federal appeals court had confirmed an August court decision that required the SEC to reconsider its decision to reject an application submitted by Grayscale Investments that aimed to turn its Grayscale Bitcoin Trust into a spot bitcoin ETF.
All Eyes On The SEC
Going forward, the major question is whether the SEC will decide to approve this proposed conversion or deny it.
Tim Enneking, managing director of Digital Capital Management, provided an optimistic take on the matter.
“At this point, it seems inevitable that the SEC will approve the conversion, although I expect the SEC to drag its feet as much as possible on actually issuing an affirmative approval,” said Enneking, a crypto analyst who has has an advanced law degree.
David Schwartz, Director of Projects and Strategic Partnerships for the Litecoin Foundation, also weighed in on the bitcoin ETF application.
“I think if Grayscale applied using the same type of template application others have recently used like Blackrock, then the chances of it being approved could be favorable,” he stated.
“There’s a part of me that thinks the Grayscale product may not get through on the first try, even if all the others were approved simultaneously,” Schwartz stated.
“Those products have now had the opportunity to go through a scrutiny that Grayscale hadn’t had the opportunity to even smell prior to the ruling,” he said.
Federal Court System Steps In
Enneking spoke to the key role that the U.S. court system has been playing in the crypto space lately, emphasizing the challenges that federal lawmakers have been encountering in their efforts to regulate the industry.
“The executive branch is borderline off the rails trying to apply 80-year-old tradfi legislation to bleeding edge, internet-based, terribly innovative financial technology, the legislative branch is paralyzed by the inability of Republicans in the House of Representatives to decide what and whom they stand for, so the judicial branch is stepping in to act as the sole adult in the room,” he stated.
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