Alameda Research Drops Lawsuit Against Grayscale Investments
Alameda Research, the sister company of FTX, has voluntarily dismissed its litigation action against Grayscale Investments following the approval of a spot Bitcoin ETF. The court filings from Jan. 22 revealed that Alameda decided not to sue Grayscale, its CEO Michael Sonnenshein, its parent company DCG, and founder Barry Silbert over the ban on Grayscale’s Bitcoin Trust (GBTC) redemptions. The lawsuit, filed in March last year, accused Grayscale of implementing an unfair regulation ban that withheld over $9 billion from FTX’s bankrupt estate. Alameda’s CEO John J. Ray III stated that the suit sought injunctive relief at the time.
Grayscale’s Response and Regulatory Nods
A representative from Grayscale confirmed Alameda’s withdrawal and reiterated their belief that the lawsuit lacked legal grounds. This decision by Alameda comes as the SEC has given regulatory approval for spot Bitcoin ETFs. This development allowed Grayscale to convert its flagship fund, GBTC, into an exchange-traded fund backed by Bitcoin. Private data indicates that FTX sold 22 million GBTC shares worth $2 billion since the SEC’s approval on Jan. 10. The SEC was instructed to re-review spot Bitcoin ETFs after losing a court case to Grayscale.
Hot Take: Alameda Drops Lawsuit Following Spot BTC ETF Approval
Alameda Research has dropped its lawsuit against Grayscale Investments after the approval of a spot Bitcoin ETF. The lawsuit alleged that Grayscale had implemented an unfair ban on redemptions, withholding billions of dollars from FTX’s bankrupt estate. However, with the regulatory nod for spot Bitcoin ETFs and the conversion of GBTC into an exchange-traded fund, Alameda has chosen to withdraw the litigation. This move aligns with Grayscale’s stance that the lawsuit had no legal grounds. As the SEC re-reviews spot Bitcoin ETFs, Grayscale has seen significant outflows from its GBTC shares, indicating a shift in investor sentiment.
By
By
By
By
By