• Grayscale announced on Feb. 7 that it had filed its final briefs in its litigation against the SEC to challenge the decision to deny the conversion of the Grayscale Bitcoin Trust into a spot Bitcoin ETF.
• SEC has repeatedly denied all applications for a spot Bitcoin ETF while allowing derivative alternatives such as ProShares Bitcoin Strategy (BITO) and Valkyrie Bitcoin Strategy ETF (BTF).
• The case’s oral arguments are scheduled for Mar. 7 in the District of Columbia.
Grayscale Challenges SEC
Grayscale has recently announced that it has filed its final briefs in line with its ongoing legal battle against the U.S Securities and Exchange Commission (SEC). This is an effort to challenge the denial of converting the Grayscale Bitcoin Trust into a spot-based Bitcoin Exchange Traded Fund (ETF).
SEC Denies Spot-Based BTC ETFs
The SEC has been denying all applications made regarding spot-based BTC ETFs, while allowing derivative alternatives such as ProShares Bitcoin Strategy (BITO) and Valkyrie Bitcoin Strategy ETF (BTF). Since their launch, these two products have accumulated over $700 million worth of assets under management. This denial by SEC is reportedly due to concerns regarding volatility levels associated with cryptocurrencies like bitcoin.
Oral Arguments Scheduled on March 7th
The oral arguments are scheduled for March 7th at Washington D.C., where both parties will discuss about Grayscale’s assessment of SEC’s framework for allowing a spot-based BTC ETFs. The final brief submitted by Grayscale calls out this approach by claiming it to be “fundamentally unreasonable” since there isn’t any significant bitcoin market recognized by the commission yet.
Timeline Of Events
A detailed timeline of events, which began in June 2022, can be found on Grayscale’s official website along with other filings related to this case.
Overall, this legal battle between Grayscale and SEC will prove to be an important milestone in determining whether or not spot-based BTC ETFs will become available in future or not. As per now, only time will tell what outcome awaits us once oral arguments take place on upcoming March 7th at Washington D.C..