The conflict between Grayscale and the Securities and Exchange Commission of the United States (SEC) is starting to resemble a judicial drama. The digital asset manager’s bid to transform its GBTC into a spot Bitcoin ETF was turned down by the SEC yesterday. Within hours, Grayscale sued the regulator to contest the outcome of the case.
It is better to break for the SEC than to fold.
The regulation change for the investment firm Grayscale Bitcoin Trust has been rejected by the SEC (GBTC). In fact, a government directive published by the American agency in charge of overseeing the financial markets rejected the idea presented by Grayscale.
This program was created with the intention of listing and trading GBTC via a spot bitcoin ETF on a market. The Commission cited the considerable risks of market manipulation, which might jeopardize investor security, to support its rejection.
Recall that the SEC has already authorized bitcoin futures contracts (BTC). However, it keeps delaying the listing of a bitcoin ETF on the US market.
Greyscale rebuttal
Grayscale declared its intention to challenge the SEC’s ruling a few hours after the rejection was made public.
We remain committed to working proactively with regulators.
— Grayscale (@Grayscale) June 30, 2022
But, now we will turn our attention to working with the Judicial branch.
Additionally, Michael Sonnenshein, the CEO of Grayscale, released a statement to express his dismay.
- “We are deeply disappointed and disagree with the vehemence of the SEC’s decision to continue to block bitcoin spot ETFs from entering the US market ,” he said.
Sonnenshein referred to the positive feedback investors have given the SEC during the filing review process.
- “We believe US investors have overwhelmingly expressed a desire to see GBTC convert to a nitcoin spot ETF, which would unlock billions of dollars of investor capital while taking the world’s largest bitcoin fund further into the world.” US regulatory perimeter ,” he said.
In the interest of investors, he continued, there was no discussion of him retiring, and the business would use all legal means at its disposal to have this decision overturned. Additionally, the official urged regulators to handle financial instruments related to bitcoin with more equality.
Additionally, Sonnenshein noted that this was a breach of the 1934 US Administrative Procedures Act. A claim that is amply supported by Donald B. Verrilli, Jr., a prominent attorney and senior legal consultant that Grayscale engaged to head off potential criticism.
