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U.S. SEC REJECTS GRAYSCALE’S APPLICATION TO TURN BITCOIN TRUST FUND TO SPOT-BASED ETF

The United States Security and Exchange Commission (SEC) has once again reaffirmed its stance against cryptocurrency by rejecting Grayscale’s application to turn its Grayscale Bitcoin Trust Fund (GBTC) into a spot-based Trade Exchange Fund (ETF) on Wednesday.

Grayscale is owned by a parent company, Digital Currency Group which also owns CoinDesk. Despite Grayscale’s magnanimous efforts to win the approval of this change, the SEC states that the application has not provided any reassuring answers to concerns over market manipulation and other issues.

This decision is also synonymous with the SEC’s rejection of Bitwise’s similar application for a spot ETF that comprises Bitcoin or/and other assets which are related to Bitcoin’s price on the go. Like in Grayscale’s scenario, Bitwise filed their application back in October but a ruling was delayed and protracted multiple times as the SEC kept asking for additional information and comments from the general public.

The final deadline given to the SEC to announce its position on the application was July 6. The denial comes as a huge blow to Grayscale and the entire cryptocurrency ecosystem at large who were hoping that the SEC would agree that the product houses sufficient investor protection.

Grayscale has now announced that it has sued the SEC after stating that according to their observations, the SEC ruling should have been in favor of their application. They announced that they are filing a petition for the review of the SEC decision with the United States Court of Appeals for the District Court of Columbia.

In April, Grayscale ran a public comment campaign canvassing the public to advocate for a bitcoin ETF to SEC. The campaign ran on several media outlets and brought in 11,400 total submissions.

Featured image source: The Coin Republic

 

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