Coinbase Executive Expresses “Hope” About a Bitcoin ETF Approval
- Coinbase and the entire crypto market will benefit from the approval of a spot Bitcoin ETF.
- The SEC suffered a significant setback in its case against Grayscale.
In a Friday interview with CNBC, Coinbase Chief Legal Officer Paul Grewal expressed confidence that the US Securities and Exchange Commission (SEC) will approve a bitcoin exchange-traded fund (ETF). Grewal said he was “quite hopeful that these applications will be granted, if only because they should be granted under the law.”
A spot bitcoin ETF tracks the price of bitcoin rather than bitcoin futures. This gives investors direct exposure to Bitcoin without requiring them to own or custody the asset. The likes of Blackrock and Grayscale have filed for a spot ETF with the SEC, leading to hopes that US investors could have one.
The SEC suffered a significant legal setback following a ruling that the agency lacked jurisdiction to reject Grayscale’s attempt to convert its GBTC bitcoin fund into an exchange-traded fund. Many within the crypto space believe approval is likely to occur in the coming months as the SEC refused to appeal the court’s ruling.
Interestingly, New York’s attorney general filed a complaint accusing Digital Currency Group, Grayscale’s parent company, and cryptocurrency exchange Gemini of cheating investors out of almost $1 billion.
Grewal did not speculate on a specific time for approval, noting that the decision ultimately rests with the SEC. However, the Coinbase executive admitted that the events of the past few days and the presence of financial giants “suggest that we will see progress there in short order.”
Grewal remarked:
I think that, after the U.S. Court of Appeals made clear that the SEC could not reject these applications on an arbitrary or capricious basis, we’re going to see the commission fulfill its responsibilities. I’m quite confident in that.
Grewal also sounded optimistic about the likelihood of more Bitcoin ETFs receiving approval sooner rather than later. He remarked that “we [Coinbase] think that other ETFs are going to be coming online soon enough as the SEC follows the law and is required to apply the law in a neutral way to the applications that are pending.”
The SEC’s approval of a Bitcoin ETF will undoubtedly boost the entire crypto market, and platforms like Coinbase stand to gain the most. Coinbase is the biggest cryptocurrency exchange in the US and a common stock that is included in investment portfolios meant to introduce investors to cryptocurrencies.
Increased Demand for Bitcoin
Bitcoin suffered severe losses in 2022 but has increased by over 72% so far this year, sealing its spot as the world’s largest digital currency. There’s been increased demand for Bitcoin over the past few months. One of the reasons has been the market’s reaction to the possibility that the Federal Reserve could end its interest rate increases. And the growing excitement surrounding the impending Bitcoin “halving” event slated for 2024.
However, some investors are concerned about the volatile nature of the crypto market and impending regulations globally.
Lawrence has covered some exciting stories in his career as a journalist, he finds blockchain-related stories very intriguing. He believes Web3 will change the world and wants everyone to be a part of it.
