Grayscale’s Spot Bitcoin ETF Rejected, Lawsuit Initiated
On Wednesday the SEC denied Grayscale Investments’ application to convert its $13.5 billion Grayscale Bitcoin Trust (GBTC) into a spot-based bitcoin ETF
The SEC cited failure to address immediate concerns such as market manipulation in its filing to dismiss a first Bitcoin ETF.
The SEC also rejected Bitwise’s application for approval of a spot bitcoin ETF.
A decision on Grayscale’s application was delayed multiple times as the SEC requested additional information and comment from the public. The regulator’s verdict came a week before the July 6 deadline. Grayscale initially filed its application in October of 2021.
Although the odds were not in favor of an approval, with the SEC consistently having snubbed all applications presented so far, the latest denial is still a blow not only to Grayscale, but for the entire crypto industry.
All eyes are now on Grayscale on what its next steps might be. CEO Michael Sonnenshein said on June 27 that his firm considers taking the US regulator to court should the application be denied. The firm recently brought a top Obama administration lawyer on board.
Grayscale announced announced on Twitter that it is contesting the SEC in court:
“We fervently disagree with the SEC’s decision. We are disappointed. We are prepared. We have spent months preparing for all scenarios. No realistic outcome would have been a surprise.
Our team has filed a Petition for Review with the D.C. Circuit Court of Appeals. This document officially initiates a lawsuit contesting the SEC’s decision.”
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Source: igaming
