Bitcoin Gains Ground as Grayscale’s ETF Conversion Receives Legal Boost
Crypto News – Bitcoin saw a modest uptick early on Monday, buoyed by a recent legal win for Grayscale’s ambitions to convert their funds into an Exchange-Traded Fund (ETF).
On Monday morning, Bitcoin approached the $28,000 mark as the prospect of a spot ETF for the cryptocurrency gained momentum.
As of now, it is trading at around $27,700, having briefly touched $27,958 on Monday morning, according to data from CoinGecko.
A significant factor in this recent movement was a favorable legal development concerning Grayscale’s pursuit of an ETF.
On Friday, reports from credible sources indicated that the Securities and Exchange Commission (SEC) would not contest an August court decision that had previously hindered Grayscale’s Bitcoin ETF filing.
In that ruling, the court had stated that the SEC’s initial rejection of Grayscale’s application to convert the Grayscale Bitcoin Fund (GBTC) into a spot Bitcoin ETF was “arbitrary and capricious.” This implies that the SEC is likely to reconsider the application.
Unlike conventional exchange-traded funds, GBTC does not permit investors to redeem the underlying asset it intends to track. Consequently, this has caused significant price disparities between GBTC and Bitcoin, as traders cannot exploit the difference through arbitrage.
Throughout this year, GBTC has consistently traded at a discount, at times reaching as high as 47%. Presently, this discount is at 15.8%, the narrowest since late 2021, as reported by Ycharts.
Grayscale is just one player among many vying for a Bitcoin ETF, with financial giant BlackRock being a notable contender that entered the race earlier this year.
In the broader cryptocurrency market following Bitcoin’s movements, several prominent altcoins experienced positive growth on Monday.
The most notable surge was seen in Solana, a high-speed layer-1 blockchain often dubbed an “Ethereum killer.”
Solana witnessed a significant increase of 5%, making SOL the top gainer among the market’s top ten cryptocurrencies.
It is currently trading at $23, down 91% from its all-time high of $259 achieved in November 2021. Solana’s rise comes amidst reports that the FTX estate had staked a considerable amount of SOL over the weekend. Given concerns about creditors, there were worries that the estate might sell off its cryptocurrency holdings to reimburse users.
Another winner for the day was Binance’s native BNB token, which saw a nearly 3% increase overnight. Binance, the industry’s largest cryptocurrency exchange by trading volume, executed a burn of over 2 million BNB tokens, amounting to $450 million. “Burning” in the crypto realm involves the destruction of the asset, effectively reducing its circulating supply.
Overall, the broader cryptocurrency market experienced a 2.4% overnight increase, contributing around $24.8 billion to the total market capitalization of all cryptocurrencies.
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