What I am wondering is what is BTC used for these days, and what is driving its value? I notice that GBTC is currently trading at a 15% discount to NAV at the moment. This would imply a nice immediate bump in value if allowed to convert from a closed-end fund to an ETF, or if it was liquidated due to an ETF. But really nervous about betting on those scenarios.
IF a bitcoin ETF is approved than all the regulatory risk is tamped down. But IF a bitcoin ETF is not approved then bitcoin will probably get a healthy haircut. Personally, I think, it is much more likely that a Bitcoin ETF is approved after everything that has gone on in court.
It doesn’t. But it does make it a little harder for the SEC from coming in and regulating BTC under a claim of existing regulatory authority.
As for the original question, the “story” behind Bitcoin is a claim that it will be valuable either as digital money or a digital analog to gold. That enough people will agree to act as though it has value for it to actually have value as either a medium of exchange or a store of value over time. If you accept that story, then the “value” of Bitcoin depends a great deal on the degree to which acceptance of it (either as currency or “gold”) spreads further and further into the broader financial sphere - and among retail, “ordinary” people.
Not entirely. Bitcoin futures are regulated by the CFTC, not the SEC. A Bitcoin future already has received regulatory blessing, and therefore a Bitcoin Future ETF is/was difficult for the SEC to deny.
But Bitcoins themselves are not CFTC-approved instruments. Or commodities. They’re a thing that the SEC very much does not like, it appears. So the SEC has been…reticent to allow an ETF that holds Bitcoins, rather than Bitcoin futures.
If that distinction gets obviated by a court decision, it will reduce the regulatory risk for established financial institutions who might want to make it easier for people to purchase BTC. The SEC has (of late) been going after many crypto projects as being unregistered securities. They probably won’t do that for BTC…but neither have they confirmed that BTC isn’t a security, either. Losing in court might bring them closer to having to take that position.