Early in August 2023, Bloomberg ETF experts James Seyffart and Eric Balchunas calculated a 65% likelihood of a spot bitcoin ETF approval. However, as August draws to a close and in light of a US court ruling in favour of Grayscale in a legal battle with the US Securities and Exchange Commission (SEC), the pair have changed their prognosis, now putting the possibility at 75%.
Reports suggest that Seven-Spot Bitcoin ETFs face an SEC decision in the face of the possibility of Bitcoin Spot ETF approval. The U.S. Securities and Exchange Commission (SEC) is about to approve or reject seven different proposals for a spot bitcoin ETF, barring any delays. Famous companies, including Valkyrie, Invesco, Bitwise, Wisdomtree, Vaneck, Fidelity, and Blackrock, are the source of these applications. Balchunas, a senior ETF analyst at Bloomberg, commented that he and Seyffart had resolved the disequilibrium as was noticed from their earlier forecast.
Bloomberg analysts give their 2 cents
Although the Securities and Exchange Commission (SEC) has previously rejected such petitions, many analysts believe there is a good likelihood that at least some of them will be accepted, particularly BlackRock’s application, which has historically had few ETF applications rejected.
Seeing that there is a great possibility for Bitcoin Spot ETF approval, Balchunas posted the following to the social media platform X (formerly known as Twitter): “James Seyffart [and] I are upping our odds to 75% of spot bitcoin ETFs launching this yr (95% by end of ’24)…While we factored Grayscale win into our prev 65% odds, the unanimity [and] decisiveness of ruling was beyond expectations and leaves SEC w ‘very little wiggle room’ via [Elliott Z. Stein].”
Balchu sinks that in addition to the legal damage, there is also the significant loss of public relations — which is otherwise essential when it comes to businesses because the same shapes narratives and alters perceptions. He also said that this issue was extensively covered by the mainstream media outlets; including the NYT, WSJ, CNN, AP, ABC, and many more. Denial will likely become politically unviable because of the “legal and PR setback”, in the duo’s views.
“The judges unanimously repudiated the SEC’s arguments, and the agency will struggle to justify further denials as it faces deadlines,” Bloomberg analysts Elliot Stein and James Seyffart added in a separate note on August 30.
Conclusion
The prediction from the ETF specialists about the real probability of Bitcoin Spot ETF approval comes after a D.C. law court sided with Grayscale, the biggest cryptocurrency asset management, in its legal struggle with the SEC over its reluctance to convert GBTC to a spot Bitcoin ETF. Balchunas noted that in light of the current decision, he and Seyffart wouldn’t be surprised if the SEC chose to postpone the decision. However, he thinks the precise time may not be as important; it’s more likely that one morning we’ll learn the SEC has caved and a launch is imminent – which is being touted as the most likely conclusion to this chain of events.
The thought that SEC Chairman Gary Gensler minimized his involvement at the agency in a recent conversation with Bloomberg and emphasized that there exist four other commissioners when questioned about cryptocurrency-related concerns helps to explain the more upbeat outlook. Bloomberg analysts believe following this, there is an indication about the aspects of the “anti-crypto stance” which might be posing political untenability for Gensler.
The email stated that although there are five members, the chair has significantly more authority and it would be unusual for the two other Democratic commissioners to make a different conclusion. “The deflection seemed a change in the way he normally handles these topics,” the note stated.
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