Grayscale sues SEC after its bid for a spot bitcoin ETF is rejected


Grayscale Investments sued the U.S. Securities and Exchange Commission on Wednesday, shortly after the regulator rejected its offer to list the first bitcoin goodwill in cash.

The SEC has denied a number of one-off bitcoin ETF proposals in recent years and, in its decision on Wednesday, said Grayscale had failed to demonstrate that its proposal meets standards to prevent fraud and “acts and manipulative practices “.

“We are deeply disappointed and disagree with his decision,” Grayscale said in a statement, calling the SEC’s decisions “arbitrary and capricious.”

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“The SEC is not applying consistent treatment to bitcoin investment vehicles, as evidenced by its denial of the GBTC conversion request to a cash ETF, but the approval of several ETFs of bitcoin futures.” , said Grayscale. “If regulators are comfortable with ETFs that have derivatives of a particular asset, logically they should be comfortable with ETFs that have that same asset.”

Grayscale later filed a lawsuit with the U.S. Court of Appeals in Washington, DC to review the SEC’s order, alleging that the regulator violated the Administrative Procedure Act and the Stock Exchange Act. .

“The decision to file a lawsuit is not one we take lightly, but we rely on our legal team as well as our compelling, common-sense legal arguments,” Grayscale said in a statement.

Grayscale is one of the largest digital currency managers in the world, and had filed earlier this month to allow its nearly $ 20 billion Bitcoin trust fund to become an ETF that would be traded on the NYSE Arca stock exchange. . Regulatory approval of a cash ETF would be seen as an important milestone for a wider adoption of cryptocurrencies and potentially increasing liquidity for the wider cryptocurrency market.

Grayscale is a unit of Digital Currency Group, which also owns CoinDesk.

The price of bitcoin BTCUSD,
-0.65%,
the world’s largest cryptocurrency fell further on Wednesday, falling briefly below the $ 20,000 level, according to Coindesk data, about 70 percent of its high in November.



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