A federal appeals court formalized a victory for Grayscale Investments LLC in its bid to create an exchange-traded fund based on Bitcoin over the objection of the US Securities and Exchange Commission.

The move sends the matter back to the SEC. The mandate puts into effect the court’s ruling in August, when it overturned the SEC’s rejection of Grayscale’s proposal to convert its trust into an ETF. Judge Neomi Rao called the SEC’s decision “arbitrary and capricious” because the regulator failed to explain why it approved similar products. The SEC had argued that an ETF based on Bitcoin lacked adequate oversight to detect fraud.