Grayscale Urges SEC to Approve All Bitcoin ETF Applications Simultaneously
Grayscale, a cryptocurrency asset management firm, has written a letter to the U.S. Securities and Exchange Commission (SEC) advocating for the simultaneous approval of all qualifying Bitcoin spot ETF applications. The company argues that this approach would prevent the SEC from “picking winners and losers” in the market. However, Grayscale also contends that Coinbase, a popular cryptocurrency exchange, should not be considered a suitable surveillance partner for launching such a product, citing the SEC’s skepticism towards pricing data from unregulated Bitcoin trading venues. The SEC has previously rejected proposals that relied on data sourced from exchanges like Coinbase. Grayscale is currently challenging the SEC in court, seeking to convert its Bitcoin fund into an ETF.
Key Points:
– Grayscale believes that the SEC should approve all qualifying Bitcoin spot ETF applications simultaneously to avoid showing favoritism in the market.
– The company argues that Coinbase does not meet the SEC’s requirements for a surveillance-sharing agreement (SSA) due to concerns about the reliability of pricing data from unregulated Bitcoin trading venues.
– The SEC’s previous rejections of Grayscale’s ETF application and the GraniteShares ETP Trust, which intended to form an SSA with Gemini’s exchange, demonstrate the SEC’s skepticism towards market data sourced from spot Bitcoin exchanges.
– Grayscale emphasizes that it does not dispute the value of information obtained through a surveillance-sharing agreement with a spot Bitcoin trading venue.
– Grayscale is challenging the SEC in court, aiming to convert its Bitcoin fund into an ETF by asserting that CME Bitcoin Futures represent a market of sufficient size related to the Bitcoin spot market.
Hot Take
Grayscale’s letter to the SEC highlights the need for fair and consistent regulation in the cryptocurrency market. By advocating for the simultaneous approval of Bitcoin spot ETF applications, Grayscale aims to ensure that no particular player is favored or disadvantaged. The company’s argument against Coinbase as a suitable surveillance partner also raises questions about the reliability of pricing data from unregulated exchanges. Grayscale’s court battle with the SEC showcases its determination to push for the conversion of its Bitcoin fund into an ETF, potentially paving the way for greater institutional participation in the cryptocurrency market.
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