Investment management firm BlackRock has a 50% chance of getting its Bitcoin spot (BTC) Exchange Traded Fund (ETF) approved, according to Eric Balchunas, a senior ETF analyst at Bloomberg.
Balchunas' prediction follows a remark by Elliott Stein, a senior litigation analyst at Bloomberg Intelligence, who now estimates that Grayscale's chances of winning its case against the SEC are 70%.
Another reason we grant approval for the spot bitcoin ETF with a 50% probability is our senior legal analyst @NYCStein gives Grayscale a 70% chance of winning the case against the SEC, which could approve BlackRock's ETF as a way to save face by using trusted 'adult' TradFi cos and sticking it to Grayscale via @JSeyff pic.twitter.com/pHydOcpuQo
—Eric Balchunas (@EricBalchunas) June 27, 2023
Balchunas explained that the SEC may view BlackRock's ETF filing more favorably as a way to "save face" by allowing an ETF from a "trusted 'adult' TradFi" firm rather than Grayscale.
Since Grayscale appealed to the United States Securities and Exchange Commission decision to deny your application in June 2022, the two parties engaged in back-and-forth legal filings in addition to oral testimony heard by three United States federal appeals court judges on March 7.
“We believe Grayscale has a 70% chance of winning its lawsuit against the SEC over the company's offer to convert Grayscale Bitcoin Trust (GBTC) into a Bitcoin ETF.”
Stein added that Grayscale's odds increased from 40% after the parties' oral arguments came to an end because "all three judges on the panel appeared to side with Grayscale" based on their "lines of questioning," Stein said.
Stein said Bloomberg expects a conclusion to be reached in August.
Bitcoin ETF applications have been a central focus point for the industry of late, with Fidelity, Invesco, Tree Of Wisdom and valkyrie after $10 billion asset management company BlackRock online for SEC approval.
If the SEC ultimately approves applications from JPMorgan, Morgan Stanley, Goldman Sachs, BNY Mellon, and Bank of America seeking to offer similar services, the digital asset market would be exposed to companies with a combined $27 trillion in assets under management.
1/ last week @Black Rock Bitcoin ETF filing was big news!
but, it is not the only story. many of the largest financial institutions in the US are actively working to provide access to Bitcoin and more.
a quick look: $27 trillion in client assets here! pic.twitter.com/azmHZmUL2a
— Meltem Demiror (@Melt_Dem) June 26, 2023
Related: Companies Managing $27 Trillion In Assets Are Embracing Crypto: CoinShares CSO
While awaiting the decision of the Grayscale case, GBTC rose more than 134% in 2023 to $19.47, which marks its highest price since about May 13, 2022. according to Google Finance.
In addition, GBTC's share price discount compared to its general net asset value fell to 31% on June 26, the lowest level since September 12 last year, according to data by YCharts. A lower discount rate on the trust means that investor sentiment towards the product may turn more positive.
However, like much of the cryptocurrency market, GBTC is down more than 65% from its all-time high price of $56.70.
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