Bitcoin rallies 7% to $28,000 on Grayscale’s court victory over the SEC
Vrasidas Neofytou
Head of Investment Research
It was a great day on Tuesday for the crypto ecosystem and its fans as the decision by a federal appeals court that the U.S. SEC- Securities and Exchange Commission should not have rejected asset manager Grayscale's spot bitcoin ETF-exchange traded fund application, triggered a massive one-day rally across the crypto board.
D.C. Circuit Court of Appeals Judge Neomi Rao wrote in an opinion that the SEC’s decision to approve two bitcoin futures funds, but to deny applications for a bitcoin spot ETF, was “arbitrary and capricious” and in violation of federal administrative law. https://www.cnbc.com/2023/08/29/bitcoin-rallies-more-than-5percent-as-court-sides-with-grayscale-over-the-sec-in-crypto-etf-case.html
The release of the court decision triggered a massive rally across the crypto board, with Bitcoin rallying 7% to as high as $28,000, the highest since mid-August. Ethereum also jumped to nearly $1,750, Solana rose to $22, while Mana broke above $0.31 cents.
BTC/USD pair, 4-hour chart
The crypto asset manager Grayscale Investments sued the SEC last year for denying the launch of the first bitcoin ETF, by converting its popular bitcoin trust into an ETF. The rejection was an effort by the SEC to regulate the crypto market and to block the bitcoin ETFs.
The judgment could be a key positive catalyst for the cryptocurrency market as it could open the door and remove the legal barriers for the first ETF offering direct exposure to bitcoin, allowing everyday investors with a brokerage account to buy and sell in the cryptocurrency.
Investors and crypto participants had been waiting for the court decision as it would give more regulatory clarity on crypto activity, and allow more SEC approvals of other bitcoin ETF applications including that of BlackRock, Fidelity, WisdomTree, VanEck, Invesco, and others.
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