JP Morgan analysts, spearheaded by Nikolaos Panigirtzoglou, have forecasted that the US Securities and Change Fee (SEC) will seemingly be pressured to greenlight a number of spot Bitcoin Change-Traded Funds (ETFs). This prediction comes on the heels of Grayscale’s vital authorized triumph in opposition to the SEC.
Final week, a federal courtroom mandated the SEC to revisit its prior rejection of Grayscale’s bid to transform its BTC Belief (GBTC) into an spot ETF. The courtroom’s choice was rooted within the SEC’s “arbitrary and capricious” stance, the place it didn’t elucidate its differential remedy of futures-based ETFs and spot-based Bitcoin ETFs. The courtroom emphasised that the SEC’s rejection lacked a stable basis, particularly given the shut correlation between the spot market and the CME futures market.
JP Morgan Predicts Spot Bitcoin ETF Approval
Nikolaos Panigirtzoglou remarked in a observe, “The SEC must retroactively withdraw its earlier approval of futures-based Bitcoin ETFs to defend its denial of Grayscale’s proposal. Such a transfer can be very disruptive and embarrassing for the SEC.” He additional added, “Given the circumstances, it seems extra possible that the SEC will approve the pending spot Bitcoin ETF functions from a number of asset managers, together with Grayscale.”
The SEC’s latest announcement to delay selections on spot ETFs from monetary behemoths like BlackRock, Constancy, and Invesco till mid-October has additional fueled speculations. JP Morgan analysts interpret this postponement as a strategic transfer by the SEC to doubtlessly approve a number of spot Bitcoin ETF functions concurrently.
This strategy wouldn’t solely eradicate any first-mover benefit but additionally foster competitors, which might result in a discount in ETF charges. Panigirtzoglou acknowledged, “it appears to be like extra seemingly that the SEC can be pressured to approve the spot Bitcoin ETF functions which can be nonetheless pending from a number of asset managers, together with that from Grayscale.”
Nonetheless, it’s not all sunshine and rainbows. Whereas the potential approval of spot ETFs within the US is a major milestone, JP Morgan analysts have additionally sounded a observe of warning. They highlighted that spot BTC spot ETFs have been operational in areas like Canada and Europe for some time however haven’t witnessed substantial investor traction. The analysts additional famous, “Outflows from gold ETFs over the previous 12 months haven’t considerably benefited Bitcoin funds, together with futures ETFs.”
A number of days in the past, Panigirtzoglou additionally predicted that the present sell-off could also be nearing its finish, as open curiosity in CME BTC futures contracts has declined. He foresees the crypto market bottoming out within the coming weeks and a rebound within the second half of the 12 months.
At press time, BTC traded at $25,974.
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