The widely watched crypto market indicator “GBTC-Discount” fell to its lowest level in 22 months on Friday, signaling increasing optimism that Grayscale can convert its closed-end Bitcoin trust into an open-ended spot-based exchange traded fund (ETF).
Shares of Grayscale Bitcoin Trust (GBTC) traded at a 15.87% discount to the trust’s net asset value on Friday, reaching levels last seen in December 2021, according to YCharts. The discount has steadily narrowed since hitting a record low of nearly 50% during the peak of the bear market in December last year.
The latest improvement came as the U.S. Securities and Exchange Commission (SEC) decided not to appeal the DC Circuit Court of Appeals’ August ruling that overturned the regulator’s decision to block Grayscale’s attempts to use its trust converted into an ETF. The SEC had until midnight Friday to appeal the decision.
Grasycale and CoinDesk are part of the Digital Currency Group.
The SEC could Now think of new reasons to reject Grayscale’s offer to cover its trust in an ETF or to request an en banc appeal. However, the likelihood seems low considering the regulator is actively involved in other spot ETF applications.
“As far as I know, the SEC has not filed an appeal, which means it will now have to reconsider its decision. It could reject the decision again for a variety of reasons – but the agency is reportedly working with other potential issuers, which is unusual. “I feel like it’s getting ready to have them listed,” Noelle Acheson, author of the popular newsletter “Crypto Is Macro Now,” said in the Weekend Edition.
Nate Geraci, President of ETF Store, expressed last week there was a similar opinion Grayscale probably take the lead over other issuers.
On June 15, BlackRock, the world’s largest fund manager and traditional financial heavyweight, filed for a spot Bitcoin ETF with the SEC. In the following days, Fidelity, Invesco, Valkyrie Investments, WisdomTree and VanEck followed BlackRock’s lead.
A possible spot ETF approval is widely expected to open the floodgates to billions of dollars of mainstream money, although Coinbase Institutional expects inflows to come over time.