Coinbase Global Inc (NASDAQ:COIN) led a rally in crypto assets on Tuesday after a court ruling opened the way for a spot bitcoin exchange-traded fund (ETF) that would give investors exposure to the cryptocurrency without having to own it.
Shares of the cryptocurrency exchange platform jumped 14% to $83.93, while bitcoin gained 5.1% to $27,428 and ether added 3.9% to $1,716.
The District of Columbia Court of Appeals ruled in favour of Grayscale Investments in a lawsuit against the US Securities and Exchange Commission, which had thwarted the crypto asset manager’s attempt to convert the Grayscale Bitcoin Trust into an ETF.
The SEC was wrong to reject Grayscale’s application to list an ETF that tracks the spot price of bitcoin on the NYSE’s Arca market, the court said, according to a report by Reuters.
While the SEC was concerned that spot bitcoin ETFs would be vulnerable to manipulation, the regulator was open to bitcoin futures ETFs, which track agreements to buy or sell bitcoin at a pre-agreed price, per Reuters.
Other asset managers including Fidelity, Invesco and Cathie Wood’s ARK also had their applications rejected by the SEC on investor protection grounds.
The SEC has 45 days to appeal the ruling.
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