Connect with us

News

Grayscale files brief in SEC lawsuit over spot Bitcoin ETF rejection

Published

on

Source: Unsplash


Grayscale, the world’s largest digital asset fund manager, has filed an opening brief in its lawsuit against the U.S. Securities and Exchange Commission.

SEC’s argument “deeply flawed”

In a Twitter thread explaining their plan of action, Grayscale described the SEC’s application of its significant market test as “deeply flawed.”

Furthermore, the fund manager has accused the watchdog of making judgments on matters that do not fall under its jurisdiction, such as the approval of Bitcoin futures ETFs and the rejection of Spot Bitcoin ETFs.

Grayscale lawyers have argued that BTC futures ETFs and Spot Bitcoin ETFs are similar in terms of risk profile and as such, should be treated similarly. 

“We believe the SEC arbitrarily treats spot Bitcoin ETFs differently from ETFs that hold Bitcoin futures, even though they carry the same protections and risks, and deriving their price from the same underlying $BTC markets,” Grayscale said in a tweet. 

The wall street regulator has until 9 November to submit its brief. This will be followed by Grayscale’s reply brief which will be due by 30 November. Both parties are expected to submit the final briefs by 21 December 2022.

The initial lawsuit

The lawsuit was initially filed on 29 June earlier this year, just hours after the SEC rejected Grayscale’s application to convert its Grayscale Bitcoin Trust (GBTC) to a Spot Bitcoin ETF. 

“The SEC is failing to apply consistent treatment to similar investment vehicles, and is therefore acting arbitrarily and capriciously in violation of the Administrative Procedure Act and Securities Exchange Act of 1934,” Grayscale Senior Legal Strategist Donald B. Verrilli, Jr. said during the announcement of the initial lawsuit in June. 

No Spot BTC ETFs getting approved

Well, Grayscale is not the only crypto firm to get its spot BTC ETF rejected by the SEC. Before rejecting the GBTC conversion, the financial regulator rejected a similar application from Ark21Shares citing a lack of investors’ protections. 

As a matter of fact, the SEC rejected another spot Bitcoin ETF application barely hours before Greyscale filed its brief. Wisdomtree Bitcoin Trust got its ETF application rejected due to a lack of investors’ protection.

Read the best crypto stories of the day in less than 5 minutes

Subscribe to get it daily in your inbox.


Please select your Email Preferences.

Ser Suzuki Shillsalot has 8 years of experience working as a Senior Investigative journalist at The SpamBot Times. He completed a two-hour course in journalism from a popular YouTube video and was one of the few to give it a positive rating. Shillsalot's writings mainly focus on shilling his favourite cryptos and trolling anyone who disagrees with him. P.S - There is a slight possibility the profile pic is AI-generated. You see, this account is primarily used by our freelancer writers and they wish to remain anonymous. Wait, are they Satoshi? :/

Disclaimer: AMBCrypto's content is meant to be informational in nature and should not be interpreted as investment advice. Trading, buying or selling cryptocurrencies should be considered a high-risk investment and every reader is advised to do their own research before making any decisions.