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Grayscale criticizes the SEC for approving a leveraged Bitcoin ETF, while the company is embroiled in a lawsuit against the regulator over its rejection of its spot
Digital asset manager Grayscale's lawyers have criticized the US Securities and Exchange Commission for its decision to approve a leveraged Bitcoin-based exchange traded fund (ETF), while the company itself has filed a lawsuit against the regulator over the rejection of its spot Bitcoin ETF. In a letter to the U.S. Court of Appeals for the District of Columbia, the lawyers argued that the SEC had approved a leveraged ETF that they viewed as riskier than Grayscale's traditional Bitcoin-based futures exchange-traded products. They further argued that this implied discriminatory treatment of spot Bitcoin ETPs. On Twitter they presented the letter they had submitted. The lawyers explained that the SEC...
Grayscale criticizes the SEC for approving a leveraged Bitcoin ETF, while the company is embroiled in a lawsuit against the regulator over its rejection of its spot
Digital asset manager Grayscale's lawyers have criticized the US Securities and Exchange Commission for its decision to approve a leveraged Bitcoin-based exchange traded fund (ETF), while the company itself has filed a lawsuit against the regulator over the rejection of its spot Bitcoin ETF.
In a letter to the U.S. Court of Appeals for the District of Columbia, the lawyers argued that the SEC had approved a leveraged ETF that they viewed as riskier than Grayscale's traditional Bitcoin-based futures exchange-traded products. They further argued that this implied discriminatory treatment of spot Bitcoin ETPs. On Twitter they presented the letter they had submitted.
The lawyers explained that the SEC could revoke the approval of all Bitcoin-based ETPs to address the alleged discrimination, but the commission made it clear that it had no such intention. The SEC last year rejected Grayscale's application to convert its Bitcoin Trust into an ETF, leading the company to appeal the agency for allegedly violating the Administrative Procedure Act.
Grayscale CEO Michael Sonnenshein told Bloomberg that all options were on the table when asked whether Grayscale would sue the SEC. In fact, the company has already sued the SEC, alleging that the commission failed to treat similar investment vehicles consistently and behaved in an "arbitrary and capricious" manner.
The litigation between Grayscale and the SEC, which was heard in the DC Circuit Court, is expected to be completed by the end of the year. The fact that the SEC has now given approval to a leveraged Bitcoin ETF, seen as a risky move by Grayscale's legal team, raises questions about the consistency of the regulator's decision-making.
The SEC has not yet officially responded to Grayscale's latest claims. It is claimed that the only way to address the commission's unequal treatment of Bitcoin-based ETPs is to allow spot Bitcoin ETPs like Grayscale's to trade. However, the SEC has not yet announced any plans to approve a spot Bitcoin ETF and has recently rejected several applications for not being sufficiently clear and comprehensive.