Grayscale, a digital investment company,is taking the Securities and Exchange Commission (SEC) to court next week over their rejection of the Grayscale Bitcoin Trust (GBTC) as an exchange-traded fund (ETF). Donald B. Verrilli Jr., the former U.S. Solicitor General enlisted by Grayscale to help in the legal challenge, contends the SEC did not follow logic in their decision, especially after approving several Bitcoin futures ETFs with similar risk profiles.
The SEC cited worries over market manipulation and a lack of a surveillance-sharing agreement between a "regulated market of significant size" and a regulated exchange as reasons for the refusal. This logic was already applied to approve the futures ETFs, and Grayscale is prepared to argue this in court.
If their bitcoin ETF avenue is blocked, Grayscale is planning a tender offer to redeem shares of the trust and CEO Michael Sonnenshein even commented that “winning [the case] would be very good” for the Bitcoin market. However, if they lose, Grayscale is willing to exhaust all appeals, even if it takes them to the Supreme Court.
Key Points
- Grayscale is argue the SEC inappropriately treated their bitcoin ETF bid.
- SEC cited worries over market manipulation and a lack of a surveillance-sharing agreement.
- Grayscale is willing to exhaust all appeals, even if it goes to the Supreme Court.
TL;DR
Grayscale is taking the SEC to court over their bitcoin ETF bid, citing the SEC's inconsistency with similar decisions for Bitcoin futures ETFs. The case has the potential to revolutionize the Bitcoin market, with Grayscale prepared to take their appeals to the Supreme Court if necessary.