Bitcoin (BTC) has experienced significant gains this week as optimism grows around the potential approval of multiple spot bitcoin exchange-traded funds (ETFs), according to a research report by JPMorgan (JPM) released on Wednesday.
The report highlights that the Securities and Exchange Commission (SEC) decision not to appeal a recent ruling in the Grayscale case brings the approval of these applications closer. Grayscale serves as the manager of the Grayscale Bitcoin Trust (GBTC), which is currently the largest cryptocurrency fund worldwide.
Although the timing of the approval remains uncertain, JPMorgan’s analysts, led by Nikolaos Panigirtzoglou, suggest that it should occur within the next few months, potentially even before the January 10th deadline for the Ark 21Shares applications.
ETFs are trading products that are similar to stocks and track the performance of an underlying asset. They are particularly popular among investors as they allow for exposure to cryptocurrencies without directly purchasing the digital assets themselves. Additionally, ETFs offer cheaper trading options. The cryptocurrency market is optimistic that the approval of a spot bitcoin ETF will attract significant mainstream investment into the sector.
JPMorgan further emphasizes that the regulatory body is likely to approve multiple applications simultaneously instead of giving a “first mover advantage” to a single applicant. This approach would encourage healthy competition, particularly concerning ETF fees, benefiting investors.
The report also highlights the potential impact of the approval on Grayscale. If the trust is granted permission to convert into an ETF, it could face more pressure to lower fees, as stated by JPMorgan. It is worth noting that CoinDesk’s parent company, Digital Currency Group, is the owner of Grayscale.
Overall, the prospect of the approval of multiple spot bitcoin ETFs has played a key role in Bitcoin’s recent price surge, with investors eagerly waiting for the SEC’s decision.