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CNN
—
Crypto assets soared in value on Tuesday after a U.S. court approved the creation of the country's first bitcoin exchange-traded fund.
The ruling marks a milestone for crypto investors and a setback for the Securities and Exchange Commission, which has sought to regulate the digital asset industry.
Three judges on the DC Court of Appeals The Commission reversed the SEC's decision to deny permission for Grayscale Investments to launch a Bitcoin-focused ETF. The reason for the refusal was not fully explained Company applications.
“The Commission's rejection of Grayscale's proposal was arbitrary and capricious because it failed to explain its disparate treatment of similar products,” Judge Neomi Rao wrote.
An SEC spokesman said Tuesday that the agency is “reviewing the court's decision to determine next steps.”
The news sent major crypto tokens soaring. Bitcoin, which has been particularly volatile in recent weeks, rose 7% to nearly $28,000. Coinbase (COIN), the largest U.S.-listed cryptocurrency exchange, surged 15%.
The bitcoin fund at the center of the incident, Grayscale Bitcoin Trust (GBTC), rose 17%.
Grayscale argued that the proposal was substantially similar to other bitcoin investment products proposed by the SEC. already approved. Two other Bitcoin offerings from cryptocurrency companies Valkyrie and Teucrium It holds futures contracts on the Chicago Board of Trade. grayscale had The judges wrote that the court presented “uncontested evidence” that the underlying asset, bitcoin, and bitcoin futures are substantially identical.
The ruling paves the way for investment products that investors have long sought.
Spot Bitcoin ETF Traditional Investors can get exposure to digital assets without actually owning them.
“This is a historic milestone for U.S. investors, the bitcoin ecosystem, and all those who have advocated for exposure to bitcoin through the added protection of an ETF wrapper,” Grayscale CEO Michael Sonnenschein said in a statement. “We're incredibly excited to be one step closer to making a U.S. spot bitcoin ETF a reality.”
Grayscale is one of several companies that have applied for a spot Bitcoin ETF, following earlier this year the likes of BlackRock, Fidelity and Invesco seeking permission to launch their own bitcoin funds.
Bitcoin is up about 65% this year but is still a long way from its late 2021 highs of $68,000.
