Bloomberg analysts are increasing their estimates on the chances of a Bitcoin Spot ETF being approved in the United States. This change is the result of Grayscale’s recent victory against the SEC in the Court of Appeals. An analysis which, if it proves correct, should greatly boost the crypto sector.
In short
- Bloomberg analysts estimate the chance of a Bitcoin Spot ETF being approved by the end of 2023 is 75%.
- The SEC is scheduled to make a decision on seven spot ETF applications over the next five days.
- It is likely that the SEC will approve one or more Bitcoin Spot ETFs, but nothing is certain yet.
Approval of a Bitcoin Spot ETF, why not?
In an August 30 tweet, Eric Balchunas, senior ETF analyst at Bloomberg, made an unexpected statement. According to him, the chances of approval of a Bitcoin Spot ETF by the end of 2023 now increase from 65% to 75%.
Balchunas attributes this increase to the court’s decision. The latter notably condemns the SEC’s arguments according to which Bitcoin Spot ETFs represent a risk for investors.
Indeed, the Court of Appeal unanimously maintains that nothing justifies the rejection of Grayscale’s Bitcoin Spot ETF. As a result, she believes that the SEC does not have sufficient evidence to support its accusations. There is therefore no way to demonstrate that Bitcoin Spot ETFs present a risk of abuse and manipulation.
Furthermore, Bloomberg analysts James Seyffart and Elliot Stein also share their colleague’s opinion. In note separately, they specify that the chances of approval of an ETF by the end of 2024 are estimated at around 95%.
The SEC now under pressure according to Bloomberg, the crypto market in joy
For Eric Balchunas, the SEC will have difficulty preventing the approval of a Bitcoin Spot ETF. Still, it must make a decision on seven spot ETF applications over the next five days. These are requests from Bitwise, BlackRock, VanEck, Fidelity, Invesco, Wisdomtree and Valkyrie.
Balchunas thinks he wouldn’t be surprised if the SEC delays these decisions. However, he points out that the most likely outcome is that the SEC caves. It may approve Bitcoin Spot ETFs in one fell swoop. However, nothing is certain yet, given that the agency led by Gensler is very unpredictable.
The approval of a Bitcoin Spot ETF would be a major development for the crypto industry. For Bloomberg analysts, there is a 75% chance that this will be done before 2024. This optimism is naturally motivated by Grayscale’s recent victory against the SEC.
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