Grayscale Bitcoin Trust's (GBTC) ongoing litigation against the U.S. Securities and Exchange Commission (SEC) could mark a milestone for Bitcoin and signify an unstoppable crypto maturation process, according to Mike McGlone, a senior commodity strategist at Bloomberg.
He believes that rising Bitcoin futures open interest and narrowing fund price disparities may add to this momentum.
After a recent oral argument in Grayscale's lawsuit over the SEC's rejection of its application to convert the GBTC trust to an exchange-traded fund (ETF), McGlone changed his view and now believes that Grayscale is favored to win a ruling vacating the rejection order. The analyst argues that Grayscale is gaining the potential to convert to an ETF, and the dip in the enduring bull market of GBTC is a temporary blip.According to the analyst, the elongated downward trajectory of GBTC's discount from a peak premium of around 100% in 2017 to an almost 50% discount in 2022 may be ending, with the trust gaining the potential to convert to an ETF.
He views this dip in an enduring bull market as advantageous for Bitcoin, which may be more susceptible to macroeconomic ebbing tides on the back of Federal Reserve restraint.
At the hearing, the judges seemingly warmed up to Grayscale's arguments. One of them raised a question about the difference in value between GBTC shares and Bitcoin. The second judge was doubtful about the SEC's approval of futures ETFs but not spot ones. They commented that the regulatory agency had not provided sufficient reasons to support its decision.
The odds of victory for the plaintiff increased dramatically, according to various experts.