Grayscale Urges SEC Approval for Grayscale Bitcoinย (BTC) Trust Conversion
Grayscale Investments is pushing the Securities and Exchange Commission (SEC) to provides approval for converting its Grayscale Bitcoinย (BTC) Trust (GBTC) into a spot Bitcoinย (BTC) ETF. The company isย warning that the SECโs delay in approving the conversion is harming investors unjustifiably. In a letter sent to the SEC on September 5, Grayscaleโs lawyers argue that there are no grounds for treating GBTC differently from Bitcoinย (BTC) futures ETFs, which the SEC already permits. Grayscale emphasizes that the delay in granting approval is causing competitive harm to investors and spot Bitcoinย (BTC) product issuers like themselves. They believe that investors and spot Bitcoinย (BTC) product issuers deserve a level playing field as soon as possible.
Landmark Legal Win for Grayscale
In a wholeย lotย of victory for Grayscale against the SEC, a court criticized the regulatorโs decision to approve futures ETFs but not spot Bitcoinย (BTC) investment products. The court labeled the decision as โarbitrary and capricious.โ Grayscale successfully claimedย that spot Bitcoinย (BTC) ETFs are materially similar to Bitcoinย (BTC) futures exchange-traded products that have already received approval from the SEC. This legal triumph sparked a rally in digitalย currency assets and is seen as a breakthrough for an industry struggling against the SECโs regulation-by-enforcement approach.
Implications of Spot Bitcoinย (BTC) ETF Approval
The approval of spot Bitcoinย (BTC) ETFs, particularly those backed by major investment corporations like BlackRock and Fidelity, would be a wholeย lotย of milestone for the cryptocurrency industry. It is expected to drive increased demand for Bitcoin, with New York Digital Investment Group predicting an influx of $30 billion. 7 corporations, including BlackRock and Fidelity, have submitted applications to the SEC for spot Bitcoinย (BTC) ETFs. Nonetheless, the SEC has onceย more delayed a decision on these applications, causing turmoil in the cryptocurrency market. Althoughย while the SEC has extended the period for public feedback on the applications, the final deadlines for a decision are expected to be around mid-March 2024.
Harm Caused by SECโs Delay
Grayscaleโs lawyers highlight the harm caused by the SECโs delay in approving the conversion of GBTC into a spot Bitcoinย (BTC) ETF. They point out that on the day of Grayscaleโs legal victory over the SEC, a Bitcoinย (BTC) futures exchange-traded product experienced a wholeย lotย of increase in net inflows. It received over 800% more inflows than its average daily inflow forย theย past 30ย days. Grayscaleโs lawyers argue that it is reasonable to assume that the Trust would have attracted a substantial portion of this investment financialย resources if it had been operating as an ETP on that day. The delay in approval has prevented the Trust from capitalizing on this opportunity.
Hot Take
The SECโs delay in approving the conversion of Grayscale Bitcoinย (BTC) Trust into a spot Bitcoinย (BTC) ETF is causing unjustified harm to investors and hindering theย expansion of the cryptocurrency industry. The approval of spot Bitcoinย (BTC) ETFs, backed by prominent investment corporations, has theย capacity to revolutionize the industry and attract wholeย lotย of new demand for Bitcoin. The SEC should expedite the approval process to secure a fair playing field for investors and allow the cryptocurrency industry to thrive.
Insa’s extensive background in the financial realm encompasses roles as a writer, trader, and personal finance coach. Her proficiency spans a wide spectrum, ranging from commodities and indices to forex and cryptocurrencies. Insa’s specialization lies in furnishing strategic investment advice tailored to the fintech investment niche.
