Coinbase remains optimistic about the future of a U.S. bitcoin ETF, expressing confidence in its approval following the SEC’s recent court setback.
Coinbase, the largest cryptocurrency exchange in the United States, is confident that a U.S. bitcoin exchange-traded fund (ETF) will be approved by the U.S. Securities and Exchange Commission (SEC), according to Paul Grewal, the company’s chief legal officer. Grewal stated that he is hopeful the ETF applications will be granted based on the law, although the final decision lies with the SEC. This optimism comes after a recent court ruling against the SEC, which stated that the regulator had no basis to deny Grayscale’s bid to turn its GBTC bitcoin fund into an ETF.
The SEC’s decision not to appeal this ruling suggests that a bitcoin-related ETF could be approved in the near future. Grewal emphasized that reputable financial services firms have proposed robust ETF applications, indicating progress in this area. A bitcoin ETF would allow investors to gain exposure to bitcoin without directly purchasing the cryptocurrency from an exchange, making it more appealing to retail investors.
If a bitcoin ETF is approved, Coinbase stands to benefit as it is the largest crypto exchange in the U.S. and is included in portfolios designed to provide investors with crypto exposure. However, Grayscale’s bid to turn GBTC into an ETF faces challenges due to a lawsuit accusing its parent company, Digital Currency Group, of defrauding investors.
Despite this, Grewal remains positive about the approval of other bitcoin ETFs in the future. He believes that the SEC will follow the law and apply it neutrally to pending applications. The year-to-date performance of bitcoin, rising by approximately 72%, has generated increased investor demand for the digital currency. This demand has been fueled by expectations of the Federal Reserve ending interest rate rises and anticipation of the upcoming bitcoin “halving” event.
While trading volumes have declined due to decreased retail investor interest and market volatility, Grewal is encouraged by the accountability being enforced through criminal trials and regulatory actions against bad actors in the cryptocurrency space. He is optimistic that upcoming developments will revive investor and consumer interest in crypto.
In summary, Coinbase is confident in the approval of a U.S. bitcoin ETF by the SEC, citing recent court rulings and the law as supporting factors. The approval of a bitcoin ETF could have significant implications for the cryptocurrency market and Coinbase as a major exchange.