Grayscale Reaches Compromise with SEC
Grayscale, following the departure of CEO Barry Silbert, has made an amended S-3 filing with the SEC, indicating that it has reached a compromise with the regulatory body. The compromise involves adhering to the SEC’s demand for cash-only creation and redemption of shares.
Speculations Surround Silbert’s Departure
Silbert’s departure from Grayscale’s board of directors has led to speculation about its potential impact on the firm’s Bitcoin Trust becoming an ETF. Some believe Silbert’s resignation was a strategic move to improve the chance of ETF approval, while others think it was the result of an agreement with the SEC.
Multiple Revisions Made to Filing
Grayscale has made several revisions to its original filing, including changes to the fee collection method and the handling of assets in an omnibus account. These alterations aim to streamline the creation and redemption of shares and comply with SEC directives.
SEC’s Challenge for Applicants
The SEC’s reluctance to approve in-kind processes poses a challenge for applicants. Despite the belief of broker-dealers and exchanges that compliance is possible, the SEC insists on cash-only transactions for the creation and redemption of shares in a Bitcoin ETF.
Reduced Investor Safeguards
The SEC’s stance on cash-only transactions introduces uncertainty and reduces safeguards for investors. The regulatory body’s approach has been criticized for being convoluted and lacking clear guidance, potentially impacting investor protection in the crypto industry.
Hot Take: Grayscale Navigates Regulatory Challenges
Grayscale’s recent filing indicates its efforts to navigate the challenges posed by the SEC’s demands. By compromising and adhering to the regulatory requirements, Grayscale aims to increase the likelihood of its Bitcoin Trust becoming an ETF. However, the SEC’s reluctance to approve in-kind processes continues to create uncertainty and reduce investor safeguards. The potential approval of a spot Bitcoin ETF remains uncertain, with the industry closely watching Grayscale’s actions and the SEC’s ongoing investigations.
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