Grayscale has won a significant victory against the US SEC regarding the conversion of its Grayscale Bitcoin Trust (GBTC) to a spot Bitcoin ETF. This has led to a rally in the GBTC share price, which closed at $20.56 on Tuesday, August 29, with a reduced discount to the fund's underlying token holdings.

The transition to an ETF structure could align the creation and redemption of shares with NAV, leading to increased speculation about a reduction in the discount. However, some analysts believe that the SEC may still take action to prevent Grayscale from converting its GBTC product to a spot Bitcoin ETF, and may target crypto custodians and their lack of security measures.