SEC Can Keep Blocking Bitcoin ETFs, But A Grayscale Win Bodes Well For These Stocks

The jury is still out on whether the U.S. Securities and Exchange Commission (SEC) will continue denying spot Bitcoin (CRYPTO: BTC) exchange-traded-fund (ETF) applications.

But according to analysts at German bank Berenberg, the recent legal triumph of Grayscale Investments and its effort to turn its Grayscale Bitcoin Trust (OTC: GBTC) into an ETF could tilt the scales in favor of the SEC eventually greenlighting one or several other spot Bitcoin ETF applications.

What Happened: More observers are chiming in on what's bound to be a hot topic at the Benzinga's upcoming Future of Digital Assets conference.

Berenberg, for example, pointed out that — post Grayscale's legal success — stocks linked to cryptocurrencies witnessed a surge.

Notably, Coinbase (NASDAQ: COIN) saw a 14.9% increase, while MicroStrategy (NASDAQ: MSTR) experienced a 10.8% boost.

"Approval of a spot ETF would be good for bitcoin, and anything that would be good for bitcoin would be good for MSTR," Berenberg stated.

Yet, expectations are in check. Coinbase's potential role in these ETFs might be leveraged by the "SEC's reconfigured arguments for rejecting the applications," considering the current lawsuit.

Also Read: 10 Crypto Ideas From Coinbase CEO Brian Armstrong - 'Bear Markets Are For Building'

Why It Matters: The potential endorsement of a spot Bitcoin ETF could significantly impact the cryptocurrency sector by broadening the spectrum of institutional investors who can enter the market.

The appeal of ETFs lies in their ability to offer investors a stake in cryptocurrencies without the need to directly buy the digital assets.

While the court didn't explicitly instruct the SEC to approve a spot Bitcoin ETF, it emphasized that the regulatory body should re-evaluate the rationale behind its refusal of Grayscale's request.

The SEC retains the right to challenge the court's decision, as highlighted in the report.

You can learn more about this evolving landscape and the crypto ETF space at the upcoming Benzinga's Future of Digital Assets conference.

The event will offer attendees a deeper understanding of the latest trends and shifts in the digital asset world, enriched by insights from industry front-runners.

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