Spot Bitcoin ETF Set For Approval In A Few Months, Predicts Former SEC Insider

There's an increased expectation of a spot Bitcoin BTC/USD Exchange Traded Fund (ETF) being approved in the coming months, in light of recent developments surrounding cryptocurrency regulations.

This news aligns with the upcoming Benzinga's Future of Digital Assets conference scheduled for Nov. 14, where discussions on the evolving crypto landscape will be at the forefront.

Neel Maitra, a partner at Wilson Sonsini who formerly worked for SEC Chairman Gary Gensler in the crypto division, recently discussed the state of crypto regulations in the U.S. with Canaccord Genuity.

Maitra's insights suggest a gradual positive momentum in favor of the crypto industry, particularly in light of court victories achieved by Ripple and Grayscale.

The former's case emphasized that not all cryptos should be classified as securities, while Grayscale's win sets a promising precedent for the possibility of a spot BTC ETF.

Bitcoin's recent 26% surge to approximately $34K in October further amplifies the optimism.

Maitra pointed out the strong correlation between BTC futures and the spot market, indicating that concerns over market manipulation might be overblown.

"At a high level, it does seem that a spot BTC ETF is something that could indeed be approved and be trading in a matter of months," he said, noting a shift in the SEC's position to crypto regulations.

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While the commission remains consistent in its stance on many tokens being securities, Maitra suggests that dropping the case against Ripple's XRP/USD executives indicates a more cautious approach, potentially to avoid complicating their broader regulatory objectives.

If the views from the Ripple case are upheld, exchanges like Coinbase Global Inc COIN and Binance BNB/USD could leverage such a judgment in their favor.

The SEC's decision against appealing Grayscale's appellate court win further opens the door for a spot BTC ETF.

Bitcoin's price surge in October coincided with revised spot BTC ETF applications from major financial institutions and the SEC's dwindling time to appeal against the Grayscale decision.

"I think these products will go ahead...Grayscale's CEO has sort of said it's a question of when, not if, and I tend to think that that's right," Maitra said.

However, uncertainty remains on how individual crypto assets and issuers will be targeted.

The Howie Test continues to be a point of contention between the SEC and the industry. Despite the SEC's acceptance of Ethereum futures ETFs, Ethereum's ETH/USD status post-merge still remains speculative, Maitra noted.

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