The crypto community has been looking forward to a Bitcoin ETF approval, part of which excitement is driving the Bitcoin rally. However, the SEC has delayed decision on all applications so far, following its utter denial of Grayscale’s application to convert to an ETF.
Grayscale appealed the decision, and won the case in court, which directed the SEC to reconsider its decision on the Grayscale application. Nothing was heard from the commission since, until now.
“We’re feeling optimistic,” Sonnenshein said on Wednesday on Yahoo Finance. “We have been actively engaging with the SEC. The questions that we’re getting from them signal to us that they want to engage on this issue, that they’re eager to make progress on this issue,” he added.
However, there are no timelines, according to Sonnenshein. This may be a bit disappointing to the crypto community, as most people anticipated that ETF approvals would come before the end of 2023.
This hope was ignited when SEC chair Gary Gensler in September said the commission was working on several ETF applications at the same time. Many analysts had also predicted that the commission would approve many applications.
Crypto is Here to Stay
The crypto industry is facing serious regulatory challenges in the U.S, mainly orchestrated by the SEC. Some Democrat lawmakers have also shown their backing for the approach the commission is using to tackle the industry.
However, Sonnenshein believes the industry is here to stay and legacy institutions will end up coming to it. Asked to comment on the statement by JP Morgan CEO Jamie Dimon that he would have shut down crypto as U.S president, he had this to say.
“But if you take a big step back, there is no question that this asset class is here to stay, that investor interest in this asset class is only growing and it is these exact types of entities, these legacy institutions, these banks that are already well underway on evolving their business models to account for these new technologies,” he said.
Dimon’s statement may be a bit hypocritical though, as the company has itself ventured into the crypto industry. JP Morgan even launched a coin known as JP Morgan Coin, showing that it was interested in crypto.
The SEC and Bitcoin ETF
Before now, the SEC has approved Bitcoin futures ETFs, several of which still operate in the U.S. It remains skeptical about a Bitcoin spot ETF though, which is why no approval has been given despite several applications over the years.
Both the court and lawmakers have questioned the decision of the commission to approve futures ETFs but not spot ETFs. The court, during the Grayscale ruling, said there was no real justification for approving a futures ETF but not a spot one, since the requirements are the same.
As it stands, the chances of a spot Bitcoin ETF approval this year is getting slimmer, just as much as the chance of approval in Q1 2024. One thing that seems certain though, is that approval will eventually come, no matter how long it takes.