Gary Gensler Takes a Fresh Look at Spot Bitcoin ETF Approvals After Court Ruling

After consistently denying approval for a spot Bitcoin ETF for American investors over the years, there are indications that SEC chair Gary Gensler might be reconsidering his position in light of Grayscale’s legal triumph.

While he has not explicitly acknowledged any change in stance, he admitted taking a new look at the approval process of a spot Bitcoin ETF following the recent court rulings.

Softening Stance?

In an interview with CNBC’s “Money Movers,” Gensler said,

“I think it’s between eight and a dozen filings. I’m chair of a commission. I’m not to prejudge anything. So, that’s going through the process right now. And as you might know, we had in the past denied a number of these applications, but the courts here in the District of Columbia weighed in on that. And so we’re taking a new look at this based upon those court rulings.”

The District of Columbia Court of Appeals in Washington in August ruled that the SEC made an incorrect decision in denying approval for Grayscale’s proposed Bitcoin ETF. This ruling held significant importance for the industry, which has been seeking for a decade to progress and establish such crypto investment products.

Despite the hostility towards the sector, the SEC opted against appealing the court decision. This decision subsequently led to speculation that it may open the door for the regulatory agency to reconsider and assess Grayscale’s application.

In the latest interview, Gensler refrained from mentioning Grayscale but emphasized the SEC’s role in operating within the framework of laws established by Congress and interpreted by the courts. He also cautioned investors about prevalent noncompliance with securities laws designed to provide disclosure for informed investment decisions and protect against fraud and manipulation.

Besides Grayscale, several major asset management firms, including BlackRock, Fidelity, Invesco, VanEck, and Valkyrie, are currently competing to introduce a spot Bitcoin ETF. Although the approval process for all these applications has experienced delays, experts are confident approval is likely to take place in early January 2024.

Grayscale Optimistic Following Conversations With SEC

Grayscale has been eagerly eyeing a spot Bitcoin ETF after securing a court win against the SEC.

While specific timelines have not been disclosed, Michael Sonnenshein, the CEO of Grayscale Investments, expressed positivity regarding discussions with the SEC regarding the possibility of a spot Bitcoin ETF. The exec shared his optimism, stating that his firm has been actively involved in conversations with the regulatory watchdog.

He noted that the questions posed by the SEC suggest a willingness to engage on the matter and a desire to make advancements in this area.