Although the cryptocurrency market has significantly developed over the past few years, the Securities and Exchange Commission (SEC) still uses the same tactics it employed almost five years ago. The institution has once again postponed its decision on approving spot Bitcoin exchange-traded funds (ETFs). Even the recent court ruling challenging its position has not changed the institution's stance.

SEC (Once Again) Postpones Decision on Spot Bitcoin ETFs

Initially scheduled for next week, the new decision dates for applications from Invesco, WisdomTree, and Valkyrie have been extended to mid-October. This development comes close to a federal appeals court ruling, which ordered the SEC to reconsider an application from Grayscale Investments for a similar product.

Two days before the SEC's announcement, a federal appeals court ruled that the agency was incorrect in denying Grayscale Investments the opportunity to establish a spot Bitcoin ETF. The District of Columbia Court of Appeals has now mandated the SEC to reevaluate Grayscale's application. While the regulatory body reviews the court's decision, there's no guarantee that its final judgment will favor Grayscale.

In recent years, the SEC has dismissed numerous applications for spot Bitcoin ETFs. The regulatory body cites insufficient trading surveillance, which they argue could expose the underlying Bitcoin market to fraudulent activities and manipulation. This stance has remained consistent despite increased interest from major players in the financial sector.

The price of Bitcoin declined as it reacted to the latest news. During yesterday's (Thursday) session, BTC lost over 5% and fell below the local support level of $26,000.

A Ripple Effect on the Industry

In a related development, BlackRock, the world's largest asset manager, submitted its application for a spot Bitcoin ETF in June. This move was perceived by many as a potential turning point for the cryptocurrency industry and even led to a surge in Bitcoin prices. However, the market remains uncertain given the SEC's history and recent delay.

BlackRock's application set off a domino effect in the market, prompting many other companies to submit their proposals. The current situation closely resembles that of 2018 and 2019, when the market was flooded with the first wave of applications for spot Bitcoin ETFs. At that time, the SEC also dragged out the decision, ultimately rejecting the companies' applications.

According to experts, the SEC will eventually have to relent and allow these types of instruments to trade on the American market. However, it is currently engaged in open warfare with cryptocurrency companies, bringing lawsuits against firms, such as Binance and Coinbase.