Grayscale wants all Bitcoin ETFs to be approved by the SEC simultaneously
July 28, 2023 7:31 AM
The Securities and Exchange Commission previously rejected Grayscale's ETF, and the SEC wants it and competing ETFs approved concurrently so that no one has an advantage.
Crypto fund manager Grayscale is requesting that all new spot Bitcoin (BTC) exchange-traded funds (ETFs) be approved by the Securities and Exchange Commission at the same time to prevent one from having an edge.
In a blog post→ published on July 27th, Grayscale's chief legal officer Craig Salm stated that the company's legal team had written to the SEC in regards to the eight spot Bitcoin ETF submissions, including the company's own, suggesting that the SEC shouldn't pick "winners and losers" and rather reach a fair and orderly decision.
According to the letter→, the SEC might approve spot ETFs depending on its approval for Bitcoin futures ETFs because the two fund types are "inextricably linked."
In addition, Grayscale stated that the SSAs that Coinbase and the spot ETF providers have just entered into are "not a new idea" and that they would not pass the SEC's muster.
Invesco, Valkyrie, BlackRock, VanEck, Wisdom, Fidelity, and ARK Invest ETF filings→ were recently revised to include SSAs with Coinbase.
Coinbase would disclose information from its trading books as well as other data with the SEC in order to monitor any potential market manipulation or abnormal trading activity.
Due to the lack of SSAs, the SEC pushed back on the ETFs in late June, claiming that they were required due to the possibility of crypto-currency markets being manipulated.
Grayscale, on the other hand, contended that the SSA's "would neither satisfy nor be necessary" under SEC criteria because Coinbase did not register with the Securities and Exchange Commission (SEC) as a securities exchange or broker-dealer nor with the Commission on Commodity Futures Trading as a futures exchange.
It went on to say that licensing the ETFs would be "a positive but rapid and significant change" in the SEC's application of its criteria and would "improperly provide an unequal and biased first-mover advantage for these proposals."
According to Salm, the Grayscale Bitcoin Trust (GBTC), which tries to monitor Bitcoin's price, has roughly 1 million investors.
He stated that converting it to an ETF would return billions of dollars to investors and that there is "simply no reason" for the SEC to restrict GBTC investors from investing in a spot Bitcoin ETF.
In June of last year, the SEC turned down Grayscale's request to change the GBTC into a spot Bitcoin ETF.
Grayscale responded by suing the regulator, alleging that it was acting arbitrarily by failing to apply uniform treatment to identical investment vehicles.