Oct 16, 2023

The U.S. Securities and Exchange Commission (SEC) won’t appeal a courtroom loss against Grayscale, a person familiar with the matter said Friday, boosting the odds the Grayscale Bitcoin Trust (GBTC) can be turned into a more-appealing ETF.

Video transcript

It looks like the SEC won't appeal court ruling against gray scale as we reported here, the move boost the odds of the gray scale Bitcoin Trust uh potentially turning into a more appealing ETF So joining us now to discuss is the author of the crypto trader Glenn Goodman. Welcome back as always, Glenn. Good to be here. Glad to see you. OK. So, you know, we had this uh rally overnight uh overnight uh New York time, midday, Asia, what do you think drove it? Was it this enthusiasm about stuff that happened two or three days ago uh with a potential uh decision by the SEC of uh not appealing this uh this potential ETF uh from gray scale. Yeah, I think that that has to be the reason uh because stock markets which have been watching closely in the futures before opening and so on. Uh and in Asia uh are up a little bit, but they're not really showing the same kind of enthusiasm that the uh Bitcoin market is, which tells me that yes, it is uh a sort of renewed Asian excitement as in the Asian markets this morning to the idea that there might actually finally be this mythical, uh Bitcoin ETF that it might finally come to exist. Did, did what happened with the Ether ETF s that came to the market a few, a few weeks ago here. Uh Now we, you know, we saw about nine of them hit the market. The lackluster and performance did, is this, does this mean that potentially a spot ETF for Bitcoin is already priced in, uh, with, you know, maybe the SEC, if they're going to have to approve it, they'll just say, all right, we'll let them all go to the market and see if they'll fail. Like the, uh, ETF for, for the E futures, I don't think really, it's a matter of failing. It's just, you know, we're in a pretty boring time in the markets as you, as you talk about on the show, um, very often, you know, whenever I tune in quite a lot of the time, you're like, God, when are things gonna get more exciting and, you know, not young ones. If you, if you ever remember the show, the young ones, everything was boring. Everything was boring but like, are boring, you know, too much excitement is not always good at my age, at my age. No, I can't have excitement. I get very nervous. You'll remember the pop star, Cliff Richard was the only thing that excited you. That was only Rick though. Yeah, that's true. Uh, for, for those of you who never watch the show. You go, you gotta watch it. It's probably online anyway. Um, but, but, yeah, I mean, it's the thing about, about these ETF S is that they are going to succeed or fail based on excitement around the crypto space. And, ok, so, you know, this is not unusual. We're in the, the usual kind of part of the cycle where everything gets a bit boring. Now, I'm not the kind of person who necessarily believes that everything is preordained and that just because we've had the same cycle over and over again, you know, over the course of more than a decade now that it's going to repeat yet again in exactly the same way. In fact, we actually did see, of course, in this last cycle that something different happened because we'd always in the past in Bitcoin's price had a single big peak and then uh the decline would begin at the top of uh each, each uh cycle. But this last time round, of course, we had two peaks. We, we had one in uh about April May, uh 2021 and another one in November. So, you know, that was a, an unusual occurrence. So we can't take it for granted that the cycle is gonna repeat exactly the same way as last time. But so far, uh this bear market is playing out shape wise, you know, on the chart like that in, in very much the same way as it has done in previous cycles. And so therefore, we can kind of uh semi, I assume that next year, sometime we're going to start seeing the excitement building once again. And Bitcoin ETF s if they come to exist by then will benefit from that. I have no doubt. It's, it's just a matter of hype, excitement and narrative and frankly, the narrative that a Bitcoin ETF is now here and institutions can invest and retail uh ordinary retail investors can invest in it in a, in a more pain free way. I think that that will probably be one of the chief narratives going into the next cycle. Yes, you could argue that it's priced in and the idea of it happening is already priced in amongst the hardcore, the people who are still here and investing, but it's certainly not priced in among the uh the newer investors. And indeed people who've got bored with crypto, but we'll come back to it once prices start rising, Jen, I'll let you, I'll let you go in a second but it did my audio fail because I didn't hear the word having in any of that. You didn't say the word having, having, you did not say having, you did not, you did not talk about the Bitcoin having or having the halving I'm English. It was like having having that. That's the bit of New Jersey in me. Yeah. Um Yes, I mean that is significant actually, I was, I was looking at, uh, the various hals or HALS on my chart yesterday, over time and, you know, you can't get away from the conclusion that they do go inside rather neatly with, uh, with a sort of a little period of, of continued sideways movement and then a big takeoff. And again, it's, you know, I don't believe that anything is necessarily preordained and yet we have seen pretty much the same thing happen several times in a row. I don't think that's a coincidence. I think actually, rather than being um a supply constriction issue. I, I don't believe that because I believe the demand massively determines what happens in the Bitcoin and crypto markets, the demand skyrockets and then plummets, you know, that overwhelms any little change in supply that might happen with halving. But uh there is a self fulfilling prophecy element to the halving. As in it becomes a narrative. Everybody expects it to lead to uh a big price rise because it has done always in the past. And therefore, you know, people get in that mood, that buying mood, they get more optimistic, put that hand in hand with a spot, Bitcoin ETF and things line up quite nicely for, I would guess, you know, if we're gonna take a rough guess later on next year. All right, Glenn, we got to ask you for some predictions. So some market watchers are looking at this lack of appeal from the SEC in the gray scale suit, um, as an indicator that we could have a spot, Bitcoin ETF launch in January. Do you agree? And if you do, do you think that they're going to approve, you know, a bunch of ETF S at the same time like they did with Ether futures, ETF and remove that first mover advantage? Well, I've been, I've been studying it quite closely. Well, I mean, I had been anyway, but in preparation for this interview, I've read just about everything there is to try and work out what the chances are to try and gauge the chances. But, uh, it, it seems to me that ultimately, the sec haven't got much of a leg to stand on in terms of arguments. Yeah. Ok. They could put a few little roadblocks in the way saying, oh, well, you haven't quite sorted out arrangements for custody, uh, or, you know, we need a creation redemption function and don't forget you'll have to list on the New York Stock Exchange. You know, they could make things difficult and try and delay it a little bit longer, but they haven't any more after this court decision really got a major argument in their favor. What they do have though, of course, is Gary Gensler and his seeming, um, knee jerk dislike for all things, Bitcoin and crypto. And so even though they might have a strong argument, he's still the boss and maybe he will just find things to stop it from happening. But like you quite rightly pointed out, there are the likes of Blackrock and Fidelity now, you know, bearing down upon him, they want their ETF S approved. So they're going to be saying, you know, well, you haven't got any more excuses and they're pretty powerful. Who knows how scared he is of them or isn't of them? I suspect that they will have some influence because they're just such enormous players. And yes, if one Bitcoin ETF gets approved one spot, Bitcoin ETF, I suspect the whole lot will be there competing with each other. All right. And we got to ask you about this news that just came out this morning. The FTX bankruptcy. A state has apparently staked millions of E and Seoul. What kind of impact do you think this is going to have on the markets? I'm not sure it will have much of an impact price wise, but it's interesting that they've done this obviously because, I mean, you know, the actual amounts that have been staked aren't, aren't massively huge. I don't think they'll have that big an impact on prices, as I say. But, um, what's interesting about this is that I, I guess they're kind of um trapped with their crypto at this point and they have to stake it if they want to make any kind of yield. But, you know, for all those people out there who might be thinking of following suit. You know, far be it from me to discourage people from doing crypto and Bitcoin things. But let's not forget that money market funds are now offering about 5.5% yield in the United States. And those are, you know, not 100% safe, but as close to it as you could possibly get and you don't really get much more of a yield, I think less than 1% in addition to that uh for staking soul. So, so it kind of uh you know, the attractions of staking aren't quite what they were a couple of years ago. Put it that way, Glen, thanks so much for joining us this morning. Always a pleasure having you on. Good to be here and I'm glad I'm glad you do a lot of research before, before signing on. I was like, you know, you have tough, you know, your stuff. I got to be on my, on my a game as you New Jersey. People would say, we love a well researched guest. Glenn, thanks so much for being here this morning. See, you see, we should, we should note that gray scale and coin desk are both owned by DC G. That was the author of the crypto trader Glenn Goodman.

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