Crypto Scores Landmark US Legal Win With Grayscale ETF Ruling

Grayscale Investments LLC won a key legal fight in its push to launch a Bitcoin exchange-traded fund, bringing the crypto industry to the precipice of tapping billions of dollars from everyday investors.

The firm’s court victory over the US Securities and Exchange Commission in a three-judge appeals panel in Washington represents a watershed moment for the largest cryptocurrency. Advocates say an ETF based on spot Bitcoin prices would result in a gush of retail cash.

The SEC, which has thus far only allowed crypto ETFs based on futures because it says they are safer, is reviewing the decision. The agency ...