Bitcoin (BTC) prices briefly rebounded above $27000 on Friday, following reports that the US Securities and Exchange Commission (SEC) will not appeal a recent court ruling that overturned its decision to prevent crypto asset management company Grayscale from converting its Bitcoin trust into an exchange traded fund (ETF).According to Reuters, the SEC was supposed to appeal this legal loss before midnight on Friday, but ultimately decided not to appeal
Bitcoin (BTC) prices briefly rebounded above $27000 on Friday, following reports that the US Securities and Exchange Commission (SEC) will not appeal a recent court ruling that overturned its decision to prevent crypto asset management company Grayscale from converting its Bitcoin trust into an exchange traded fund (ETF).
According to Reuters, the SEC was supposed to appeal this legal loss before midnight on Friday, but ultimately decided not to appeal.
As early as August, D C. The Circuit Court of Appeals ruled that the SEC's rejection of the Grayscale ETF application must be re examined and labeled as "arbitrary and capricious".
The SEC can still choose to reject Grayscale's ETF application for different reasons than the court's rejection.
But the decision not to appeal indicates that the agency's determination to block Grayscale and other companies' spot Bitcoin ETF applications is weakening.
This is in line with a growing statement in the Bitcoin market that by early 2024, the SEC will approve a batch of Bitcoin ETF spot orders. In June of this year, Wall Street giants such as BlackRock, Fidelity, and Vanguard all submitted applications.
GBTC's discount on BTC continues to shrink
Since the beginning of 2021, Grayscale's Bitcoin Trust shares, the world's largest such encryption product, have been trading at prices lower than their actual holdings of Bitcoin.
Converting to an ETF will eliminate this discount by allowing the creation of an issuance/redemption model, issuing new shares when demand increases, and then redeeming new shares when demand decreases to maintain price stability and parity with Bitcoin.
However, Grayscale's Bitcoin Trust may soon be converted into an ETF, which means that this discount has significantly narrowed in recent months.
The previous discount was 16.5%, which was the lowest level of the year, reaching as high as 47% in February.
Some analysts may view the reduction in discounts as a positive sign of rising demand in the Bitcoin market.
Bitcoin (BTC) price to the moon?
As of early Saturday, the price of Bitcoin (BTC) was narrowing to below $27000, roughly at the midpoint between 50DMA ($26650) and 21DMA ($27160).
The recent Grayscale/SEC news did not have much follow-up coverage, but it highlighted a bullish theme that has become very familiar to Bitcoin investors in recent months - the expected approval of spot Bitcoin ETFs in the coming quarters.
Coinbase analysts recently believe that they believe that the approval of spot ETFs now partially reflects the price of Bitcoin, which may mean that this theme is unlikely to provide too much through short-term favorable winds.
We believe that the difference in performance between Bitcoin and other tokens indicates that the potential approval of one or more spot Bitcoin ETPs has been partially reflected in prices. This makes it unclear how much Bitcoin can outperform the market if the US Securities and Exchange Commission (SEC) makes a decision in favor of Bitcoin, "said David Duong, research director at Coinbase Institution.
At the same time, the macroeconomic headwind remains strong.
After the boom of US inflation data this week, the yield of US treasury bond bonds is still not far from the decades high hit earlier this month, and the market expects the Federal Reserve (Fed) to raise interest rates for a longer time.
This indicates that the breakthrough in the $25000 to $28000 range of Bitcoin in recent weeks may not occur soon.
However, as we enter 2024, the approval of spot ETFs becomes a reality, and the excitement of halving Bitcoin and the possible reduction cycle of the Federal Reserve amplifies, Bitcoin prices are likely to be heading towards the moon.
At current prices below $27000, it is still more than 60% lower than its historical high.
If the history of cryptocurrencies is anything, Bitcoin may far exceed these historical highs, and there is a high probability that its revenue in the region will be 200 times higher.
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