The digital currency ecosystem has been stirred up by the recent false update from Matrixport, causing concern among investors. It has been reported that the United States Securities and Exchange Commission (SEC) will likely reject all spot Bitcoin ETF applications this month, despite popular belief. Crypto lawyer MetaLawMan has predicted that if this happens, it could lead to legal consequences.
In light of this news, many are wondering if the denial of spot Bitcoin ETFs will spark a new wave of lawsuits. MetaLawMan, who has insight into important lawsuits within the industry, believes that BlackRock, Grayscale Investments, Ark, and other ETFs will likely take legal action if their applications are denied.
According to MetaLawMan, if the lawsuits are filed and the D.C. Court of Appeals rules that the SEC’s denial was “arbitrary and capricious,” it could set a precedent for the more than 12 Bitcoin ETF applicants waiting for a decision. This is based on a similar case last year involving Grayscale Investments, where the court ruled in favor of the firm.
Interestingly, the SEC initially denied Grayscale Investments’ request to convert its Bitcoin Trust (GBTC) product into a spot Bitcoin ETF. After the firm sued and won the case, the SEC was ordered by the presiding judge to review and re-evaluate the application. Surprisingly, the SEC did not appeal this ruling, indicating that it aligned with the court’s decision. This suggests that the SEC may have exhausted all its reasons for denying spot Bitcoin ETFs and may not want to repeat the process.
Although there has been no official announcement from SEC Chairman Gary Gensler, there have been promising signs for spot Bitcoin ETFs. The SEC has been meeting with international exchanges, such as the New York Stock Exchange and Nasdaq Composite, to discuss the proposed ETF product.
The next announcement from the SEC is expected before midnight, and many in the crypto community are hopeful that the revolutionary spot Bitcoin ETF will finally be launched. Despite the controversy and challenges, it seems inevitable that this product will eventually become a reality.