To recap, an ETF is an exchange-traded investment fund whose units - that is, shares - are traded on a trading platform. For Bitcoin, the adoption of an ETF is an important step towards approval by major investors, as they will get a familiar instrument and protection, as well as the ability to capitalise on movements in cryptocurrency rates.

Last year, an ETF was adopted for major cryptocurrency futures. However, this event in itself is not as important as the adoption of specifically spot ETFs, an investment instrument based on the regular market price of Bitcoin. We have previously written about the importance of this event in our piece.

After that, many companies tried to launch spot ETFs for Bitcoin, but regulators actively blocked the idea. Eventually, the digital asset giants got fed up with the trend – and now they are ready to fight for innovation.

When will the Bitcoin spot ETF launch?

Grayscale applied for approval of a spot ETF last year. Since then, the SEC has rejected the company’s request several times. In addition, the regulator has not brought any clarity to the approval process, meaning the prospects for a Bitcoin ETF are still “up in the air”.

Recall, Grayscale serves about 800 thousand professional investors, which interact with the company’s GBTC trust fund. In it they can buy shares, the value of which is approximately equal to 1/1000 of 1 BTC. Recently units are trading below the price of BTC on exchanges, which may indicate lower investor activity amid the recent uncertainty in the crypto market.

GBTC premium

Grayscale has been trying to change the Commission’s stance for some time now. Back in December 2021, the company’s chief legal officer Craig Salm shared a letter to the agency on its social media platforms, arguing that the regulator’s position may be contrary to the law. The US Securities and Exchange Commission is still rejecting applications for ETFs with the wording that acceptance of the investment vehicle could benefit fraudsters.

Meanwhile, Bitcoin reached its yearly high the day before, with the cryptocurrency quickly updating its record, with several factors contributing heavily to the surge. According to CryptoPotato journalists, amid these positive developments for the crypto market, the inflow of large investors into the industry reached a record high since mid-December.

Experts at analytics platform CoinShares pointed out the exact numbers in a recent report. As it turns out, the volume of inflows into crypto projects amounted to at least $193 million in the last week. 76 percent of this amount was invested by Europeans, with the rest coming from the US and other countries.


This means that investors feel positive and are ready to open new positions. Given the market trend - Bitcoin and Etherium in particular rose in price by 11.4 percent and 14.6 percent respectively over the week - such behavior seems logical.


Funds flowing into the cryptocurrency industry

There has also been a serious increase in trading activity. The daily volume of crypto transactions has passed the $2.5 billion mark – also a record over the past few weeks. By cryptocurrency, Bitcoin received the most investments at $97 million, followed by Etherium at $10.2 million.

Crypto inflows by investment companies and altcoins

As we can see, optimism is slowly starting to return to the crypto market. Given the oversold nature of many cryptocurrencies, it is logical to assume that altcoins will show some returns in the coming month.


We believe this Grayscale initiative could lead to a result and the launch of a spot ETF for Bitcoin. Still, previous SEC rejections did not seem particularly convincing, so the position will have to be properly explained in the event of a lawsuit. One would like to believe that the willingness to fight for one's own right in court will still allow for a proper investment product.


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