Spot Bitcoin ETF: Probability of SEC Disapproval Drops to 5%
The excitement surrounding the approval of a spot Bitcoin ETF by the United States Securities and Exchange Commission (SEC) is reaching new heights, as analysts struggle to find compelling reasons for the regulatory body to reject the product at this stage.
The odds of a rejection for the spot Bitcoin ETF have now fallen from 10% to a mere 5%, according to Eric Balchunas, Bloomberg’s top ETF analyst. Balchunas acknowledged that even with the industry’s confidence, a 5% margin is left for uncertainty, as anything is still possible.
Balchunas’ comment was in response to James Seyffart, another ETF analyst at Bloomberg, who outlined three potential outcomes if the SEC were to unexpectedly deny a spot Bitcoin ETF. Seyffart suggested that GenZ investors would react strongly and take legal action against the SEC.
It is worth noting that Grayscale Investments previously sued the SEC and won the case when the regulator denied its application to convert its Bitcoin Trust into a spot Bitcoin ETF. Legal experts believe that the SEC has exhausted its arguments for rejection in court and is unlikely to pursue that path again. Additionally, Seyffart believes that the Biden administration would intervene if the SEC mistakenly denies a spot Bitcoin ETF.
Adding to the growing optimism, BlackRock recently expressed confidence in receiving approval for its spot Bitcoin ETF application. As previously reported, the firm has significant assets ready to inject into the market once approval is secured.
Experts believe that after subjecting applicants to rigorous scrutiny, the SEC is unlikely to reverse course and disapprove the spot Bitcoin ETF. The industry eagerly awaits the expected approval in the coming week.