The price of Bitcoin rose significantly Tuesday following word that the United States Court of Appeals for the DC Circuit sided with Grayscale over the U.S. Securities and Exchange Commission (SEC) in the crypto firm's quest to launch a Bitcoin spot exchange-traded fund (ETF).
Bitcoin is up more than 5% over the last hour, rising from just over $26,000 to a current price of $27,425, per data from CoinGecko. Other leading cryptocurrencies have seen similar rises over the past hour.
The largest cryptocurrency by market cap had largely been sitting still this summer with uncharacteristically low volatility—except when news related to a spot ETF dropped.
And today’s news that the SEC’s denial of Grayscale’s spot Bitcoin ETF application be reviewed is positive for investors: it means that a spot Bitcoin ETF could finally be coming to the U.S.
Grayscale sued the SEC last year after the regulator rejected its application to convert its Bitcoin Trust into a spot Bitcoin ETF.
A Bitcoin ETF doesn’t yet exist in the States because the SEC has been reluctant to approve one—citing market manipulation as a factor. The top regulator currently has a long list of high-profile applications to review and investors appear to be keen on such a product.
This is because it would give traditional investors exposure to the asset in a safer way: ETFs are investment vehicles that allow people to buy shares that track the price of an underlying asset, and a Bitcoin ETF would allow investors to invest in Bitcoin without having to worry about storing and protecting their cryptocurrency holdings.
In June, Bitcoin touched yearly highs of $31,000 per coin after Wall Street heavyweight BlackRock submitted its application to the U.S. Securities and Exchange Commission for a Bitcoin ETF.
Investors interpreted the application as positive news for the cryptocurrency because it is evidence that Wall Street is hungry for crypto exposure.
Bitcoin has since dipped on regulatory news and macroeconomic factors. Investors also seemed to briefly lose enthusiasm as it seemed unlikely that the SEC would be rushing to approve a spot ETF.
Today's news appears to have renewed optimism that a Bitcoin spot ETF will eventually be approved in the U.S. The SEC and Grayscale have 45 days to appeal today’s court decision.
Bitcoin is still well below its November 2021 all-time high of $69,044 per coin.
Editor's note: This story was updated after publication with additional information and context.