Grayscale sues SEC after rejection of bid to turn the largest bitcoin fund into an ETF
Summary
The SEC on Wednesday rejected Grayscales application for a spot bitcoin exchange-traded fund, citing a failure by the investment manager to answer questions about concerns around market manipulation. Grayscale filed to make its Bitcoin Trust, known as GBTC, an ETF back in October 2021, but the ruling faced multiple delays. The litigation is being led by Grayscales senior legal strategist Donald B. Verrilli Jr., a former U.S. solicitor general, and a team of attorneys at law firm Davis Polk & Wardwell. Grayscale argues the SECs position is inconsistent in light of previous decisions to greenlight other bitcoin-based ETFs, including those based on futures markets and one that allows investors to short — or bet against — the cryptocurrency. Crypto bulls had pinned their hopes on the SEC approving the first U.S. spot bitcoin ETF, a move that would potentially open the cryptocurrency up to more institutional investment.
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