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Investing.com – Analysts at Bernstein are optimistic about the potential imminent approval of a spot ETF in the United States.
In a note released on Monday, the firm did indeed say that the SEC is likely to approve a spot Bitcoin ETF soon.
Recall that at the end of last month, a multitude of applications for Bitcoin spot ETFs were filed, including from BlackRock (NYSE:), the largest asset manager in the world.
Analysts explained that the US regulator’s stance on cash (BTC) exchange-traded funds (ETFs) is difficult to hold, noting that the SEC has previously authorized bitcoin ETFs based on futures contracts, and recently approved ETFs based on leveraged futures contracts.
According to analysts at Bernstein, the SEC believes that a spot bitcoin ETF would be unreliable because “cash exchanges (e.g. Coinbase (NASDAQ:)) are not subject to its regulation, and therefore spot prices are unreliable and susceptible to manipulation”.
The report also discussed Grayscale’s attempt to convert its Grayscale Bitcoin Trust (GBTC) into an exchange-traded fund (ETF), which is currently before an appeals court.
“The court did not seem convinced that the futures price is not derived from the spot price, and therefore allowing a futures-based ETF and not allowing the spot price seems like a hard pill to swallow. for the courts,” the analysts explained.
Finally, Bernstein opined that the lack of a spot bitcoin ETF is leading to the growth of over-the-counter products like the Grayscale Bitcoin Trust (GBTC), which are more expensive, illiquid, and inefficient.
“The SEC would rather set up a regulated bitcoin ETF run by more traditional Wall Street participants and overseen by existing regulated exchanges, than have to deal with an OTC Grayscale product bridging the institutional gap,” the report surmised. .