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- Grayscale won a lawsuit against the U.S. SEC, paving the way for a potential spot Bitcoin ETF.
- The news triggered a rapid surge in Bitcoin prices, reaching a two-week high within 30 minutes.
In a significant market update, Bitcoin (BTC) rallied to near two-week highs on August 29, following news that digital asset management giant Grayscale had won a lawsuit against the U.S. Securities and Exchange Commission (SEC). According to data from Cointelegraph Markets Pro and TradingView, BTC/USD soared by $1,700 within approximately 30 minutes of the announcement, invigorating a market that had been sluggish since mid-August.
The United States Court of Appeals for the District of Columbia Circuit ruled in favor of Grayscale, stating that the SEC’s rejection of the firm’s application to launch a spot Bitcoin ETF was “arbitrary and capricious.” The court found that the SEC had failed to adequately explain why it treated Grayscale’s proposal differently from similar financial products. As a result, the court vacated the SEC’s previous order, potentially paving the way for the first U.S. spot Bitcoin ETF.
At the time of this writing, BTC/USD was hovering around $27,300, after peaking at $27,723 on Bitstamp. Data from Material Indicators showed a significant uptick in buying across all order classes on the Binance BTC/USD order book, pointing to a more liquid market than before.
Analysts have been quick to react. Michaël van de Poppe, founder and CEO of trading firm Eight, speculated that the court’s decision might also positively impact other pending ETF applications, including that of BlackRock, the world’s largest asset manager. “This might sound weird, but we could be on the verge of the start of the bull cycle with this news,” van de Poppe commented.
Before the Grayscale news broke, market analysis had revealed thin liquidity for BTC, suggesting that a surge to the $30,000 range would be likely if sentiment turned bullish. It appears that the Grayscale legal victory might be the catalyst needed for such a surge.
The win comes after a long and arduous legal battle for Grayscale. CEO Michael Sonnenshein was unrelenting in the company’s quest to convert its existing Grayscale Bitcoin Trust (GBTC) into an ETF. Following the ruling, Sonnenshein thanked supporters, signaling that the company’s fight for regulatory approval is far from over. “Thank you to everyone who has been on this journey with us, especially our investors,” he wrote.
