Grayscale takes legal action against the SEC over spot ETF rejection

SEC has reportedly rejected Grayscale’s application to convert Grayscale Bitcoin Trust (GBTC) to an Exchange-Traded Fund.

Reports disclose that a Petition for Review would be filed with the United States Court of Appeals for the District of Columbia to challenge the decision.

Grayscale is reportedly considering legal action against the US Securities and Exchange Commission (SEC). This follows the decision of the regulatory body to reject an application from Grayscale Investment to convert its Grayscale Bitcoin Trust (GBTC) to an Exchange-Traded Fund (ETF). It is important to note that Grayscale has been pushing for this conversion since April last year. 

According to the SEC ruling, there was not enough information on how the Grayscale spot ETF would protect investors from “fraudulent and manipulative acts and practices.” This ruling did not go down well with the company as Grayscale CEO Michael Sonnenshein responded that they would take legal action. Reports disclose that a Petition for Review would be filed with the United States Court of Appeals for the District of Columbia to challenge the decision.

Grayscale supports and believes in the SEC’s mandate to protect investors, maintain fair, orderly, and efficient markets and facilitate capital formation — and we are deeply disappointed by and vehemently disagree with the SEC’s decision to continue to deny spot Bitcoin ETFs from coming to the U.S. market.

Grayscale further added that they have so far hired legal counsel including Donald B. Verrilli, Jr., former Solicitor General of the United States, and law firm Davis Polk & Wardwell.

Grayscale claims SEC is inconsistent in its dealings

The first-ever Bitcoin ETF application submitted by the investment company to the SEC was in 2016. Later, it was observed that the regulatory environment surrounding digital assets was not certain enough to introduce such a product into the market, so the application was withdrawn. To boost the approval chance, the Investment company involved the public by launching a broad marketing campaign to advocate for the Bitcoin ETF to the SEC.

The comment campaign interestingly brought about 11,400 submissions to SEC. Grayscale has had all of its applications rejected by the regulatory body since its first submission, and it is believed that the SEC still thinks the market is not yet ready for such a product. However, Grayscale CEO has declared that they will continue to deploy the company’s resources to advocate for their investors. 

Through the ETF application review process, we believe American investors overwhelmingly voiced a desire to see GBTC convert to a spot Bitcoin ETF, which would unlock billions of dollars of investor capital while bringing the world’s largest Bitcoin fund further into the U.S. regulatory perimeter. We will continue to leverage the full resources of the firm to advocate for our investors and the equitable regulatory treatment of Bitcoin investment vehicles.

Donald B. Verrilli, Jr., Grayscale Senior Legal Strategist and former U.S. Solicitor General has also argued that SEC fails to apply a “consistent treatment to similar Investment vehicles”, and is violating the “Administrative Procedure Act and Securities Exchange Act of 1934.”

 

Der Beitrag Grayscale takes legal action against the SEC over spot ETF rejection erschien zuerst auf Crypto News Flash.

Related Posts

1inch plugs into KuCoin Wallet to improve token swaps

1inch Network expands to another cryptocurrency exchange as KuCoin Wallet integrates its automated market maker functionality to improve token swaps. Cryptocurrency exchange KuCoin will introduce native token…

Interlay launches trustless BTC stablecoin bridge on Polkadot

InterBTC operates as a BTC-backed stablecoin, secured by a decentralized network of overcollateralized vaults, which according to Interlay, resembles MakerDAO’s DAI token. Interlay, a London-based blockchain firm,…

Philippine Central Bank Halts Bitcoin, Crypto Service Provider Approvals For Three Years

The central bank stated virtual asset service providers pose a great risk but will allow existing businesses to continue operations or expand. The central bank of the…

Why $10 Trillion AUM BlackRock Launched Spot Bitcoin Private Trust For Clients

Investment and financial services firm BlackRock will launch a spot Bitcoin private trust in the United States, according to an official post. The investment product was created…

Automobili Lamborghini’s Third NFT Drop is Here – “The Epic Road Trip”

Automobili Lamborghini is continuing its journey into Web3. The iconic brand is taking loyalists off-road and on a virtual mission that starts from the Moon, crosses space,…

BlackRock Makes Crypto Splash With Private Bitcoin Investment Trust Product

BlackRock has followed up its Coinbase partnership with its first institutional crypto investment product: a private bitcoin trust that offers direct exposure to spot BTC price action….

Generated by Feedzy