Spot Bitcoin ETF “Approval Is Inevitable”, Says Former SEC Chair Jay Clayton

The former Chair of the US Securities and Exchange Commission (SEC), Jay Clayton, said there is a high probability that the regulator will approve the launch of a spot Bitcoin ETF sooner or later. This follows a court ruling that favors the conversion of Greyscale’s Bitcoin Trust (GBTC) into a spot ETF.

Recently, the agency postponed the review of applications from major financial companies such as BlackRock, Invesco Galaxy, WisdomTree, VanEck, Bitwise, Valkyrie, and Fidelity, who expressed their desire to introduce such a product. Bloomberg’s ETF expert James Seifert said the review process could take another 45 days. The extension could push the approval timeline beyond October.

Clayton noted that approval of spot ETF is “inevitable” given the current situation. This assurance stems from companies like BlackRock, which have grown confidence in cash trading in relation to cryptocurrency assets. Moreover, these companies have allayed trade concerns related to manipulation, he said.

Clayton added:

“It is clear that Bitcoin is not a security. It is something that retail investors want access to and importantly some of our most trusted providers want to provide this product to the retail public.”

Court’s Ruling In Favor Of Spot Bitcoin ETF

On August 29, a three-judge panel of the District of Columbia Circuit ruled in favor of Greyscale Investments against the SEC in a case involving the conversion of GBTC to a spot Bitcoin ETF. 

Previously, the SEC said the GBTC was not designed to prevent fraudulent and manipulative operations. As a result, the agency rejected the Grayscale’s request. In June last year, Grayscale also sued the SEC. Last week, Judge Nyomi Rao said the regulator had not provided solid evidence against Greyscale. He granted Greyscale’s request for review. 

The court’s ruling represented a legal triumph for Grayscale. JP Morgan analyst, led by Nikolaos Panigirtzoglou, predicted that the SEC will approve several Bitcoin ETFs after losing its court case against Grayscale. Interestingly, the BTC price has not yet shown signs of a significant upward trend.

Bitcoin ETFs track the price of Bitcoin. They allow investors to experience the allure of Bitcoin without directly owning or holding it.