Big news in the world of cryptocurrencies arrived Tuesday when D.C. Circuit Court of Appeals Judge Neomi Rao ruled that the Securities and Exchange Commission (SEC) must abandon its rejection of Grayscale’s application to convert the popular Grayscale Bitcoin Trust (GBTC) to the exchange traded fund structure.
It remains to be seen whether or not the ruling compels the SEC to finally approve spot bitcoin ETFs – arguably the most desired product in U.S. ETF industry history – but experts believe that’s exactly what the ruling implies. After all, Rao wrote her in her opinion that it’s “arbitrary and capricious” that the SEC continues stifling GBTC conversion efforts after approving futures-based bitcoin ETFs several years ago.
Indeed, the ruling is “kind of a big deal” and the reasoning behind that statement is easy to understand. Score of ETF issuers have filed applications for spot bitcoin ETFs. Should that structure gain regulatory approval, those funds will create substantial demand for the largest cryptocurrency – pertinent because bitcoin supply is fixed at 21 million.
Translation: New demand for bitcoin could lead to more constrained supply, in turn sending prices higher. Should that scenario play out as expected, other established crypto-correlated ETFs stand to benefit. Here are a few to consider.
Invesco Galaxy Crypto Economy ETF (SATO)
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