Crypto prices continued to rise in London on Wednesday after it was revealed that investment shop Grayscale is one step closer to approving a Bitcoin exchange-traded fund.
The SEC initially denied its application to convert the Grayscale Bitcoin Trust into an ETF.
Bitcoin (BTC-USD) was trading 5.6% higher in the late morning session, trading around $27,450 after the news. Meanwhile, Ether (ETH-USD) is up 4.3% to trade at $1,715.
Crypto exchange Coinbase (COIN) stock was also up sharply last night, up about 14.9% by close, though futures markets suggest it will open about 1.4% down today.
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The idea behind a spot bitcoin ETF is that it trades on a traditional exchange, although the bitcoin is held by a broker. It aims to give investors access to the world’s largest crypto asset without having to own the coin itself.
The SEC has only approved futures-based crypto ETFs because it believes they are safer.
The SEC can still challenge the decision by submitting it for review to a full panel of judges in the DC Circuit Court of Appeals or the US Supreme Court.
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Matteo Greco, research analyst at Finequia, points out that crypto is not out of the woods just yet.
“Final decisions on when and if Grayscale can list its product as an ETF have yet to be made,” he said in an email release.
“At the current price level, around 2.5 million bitcoins are held at a loss in the short term. Short-term refers to those Bitcoin that were purchased less than 155 days ago. The data shows the difficult moment for the market as the price falls back to levels not seen since June.”
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