Benzinga - by Chris Katje, Benzinga Staff Writer.
Shares of cryptocurrency companies rocketed higher on the heels of a historic ruling in Grayscale Investments' lawsuit against the Securities and Exchange Commission.
Longtime Bitcoin (CRYPTO: BTC) bull Cathie Wood predicted this exact event would occur and shared with Benzinga what could be next for Bitcoin ETFs.
On Tuesday, a federal appeals court vacated the SEC's rejection of Grayscale's application to convert the Grayscale Bitcoin Trust (OTC: GBTC) into an ETF.
'The SEC Is Going To Lose The Grayscale Case': While the Grayscale ETF conversion dispute has been ongoing for years, Ark Invest founder Wood predicted a decision could be coming anytime in an interview with Benzinga CEO Jason Raznick that airs in full at 2 p.m. ET Wednesday, Aug. 30 on "The Raz Report."
“I really do believe that the SEC is going to lose the Grayscale case and that’s going to happen really soon,” Wood told Raznick.
The SEC could respond to the case by turning around and approving several Bitcoin ETFs, she said.
“It could happen. It could happen quickly.”
The approval of Bitcoin ETFs could lead to increased demand. As many investors are aware, Bitcoin has a fixed supply of 21 million BTC, with 19 million already mined.
“If institutions want to move in, that’s going to be a lot of incremental demand for not that much more incremental supply,” Wood said.
Institutions might not have a choice but to send the price of Bitcoin higher for ETFs and for holding BTC, she said.
“The only way to do that is to bid the price up.”
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Wood is bullish on Bitcoin and said the leading cryptocurrency could hit a valuation of $1 million in the future.
Grayscale Bitcoin Trust is the third-largest holding in the Ark Next Generation Internet ETF (NYSE: ARKW), representing 7.2% of assets.
Coinbase is a top five holding in the Ark Next Generation Internet ETF, Ark Next Generation ETF (NYSE: ARKK) and the Ark Fintech ETF (NYSE: ARKF), representing 8.4%, 7.4% and 9.7% of assets, respectively. Coinbase is the largest holding in the fintech ETF from the company.
Grayscale's Bitcoin ETF Plans: Grayscale Investments applied to convert its closed-end fund into an ETF in October 2021.
Wednesday’s ruling doesn’t mean the SEC will approve the ETF, with the court stating the Grayscale application has to be reviewed.
“The Commission failed to adequately explain why it approved the listing of two bitcoin futures ETPs but not Grayscale’s proposed bitcoin ETP. In the absence of a coherent explanation, this unlike regulatory treatment of like products, is unlawful,” the ruling said.
The ruling could mean that more Bitcoin ETFs, which are among the highly anticipated ETFs filed by several players, could be nearing a launch date.
New of the ruling sent the price of Bitcoin, the Grayscale Bitcoin Trust and Coinbase Global (NASDAQ: COIN) — which has been signed as a partner with many of the Bitcoin ETFs that have filed applications — higher.
Related Link: How To Buy Bitcoin
BTC, GBTC, COIN Price Action: Bitcoin is up 4.92% to $27,334 Wednesday morning.
Coinbase shares were down 0.11% at $84.61
Grayscale Bitcoin Trust shares were down 2.77% to $19.99 Wednesday and 143.78% higher year-to-date.
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Read Next: EXCLUSIVE: Cathie Wood Says Bitcoin Is Key 2024 Election Issue For Young Voters
Photo: Ark Invest and Shutterstock.
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