Grayscale told SEC that it has no basis to approve a futures Bitcoin ETF and not a spot BTC ETF as it outlines the discrepancies in the rejection of the application as we can see more today in our Bitcoin latest news.
Grayscale investments fired back at the US SEC over the rejection of the VanEck spot Bitcoin ETF application. The operator of the Grayscale Bitcoin Trust issued a letter to the US SEC secretary Vanessa Countryman, arguing that the regulator is wrong to reject spot Bitcoin ETFs since it approved three Bitcoin futures ETFs one each from Valkyrie, ProShres, and VanEck. Grayscale told SEC that it has no basis in its decision or no basis for the position that investing in the derivatives market for the asset is acceptable for investors while also investing in the asset itself is not.
It claims the SEC violated the Administrative Protections act as it failed to treat the two bitcoin ETF products the same. The Bitcoin futures ETF allows traders to speculate on the future price of BTC via derivatives while the spot Bitcoin ETF will allow the traders to trade on the current price of the asset as it functioned similarly to holding the asset.
Grayscale is a hardly a disinterested party with the application filed back in October to list the GBTC as a BTC split ETF with a decision being brought on Christmas Eve. In November, the SEC rejected VanEck’s similar application on grounds that it was not consistent with the requirements of the Securities Exchange Act of 1934. Grayscale, however, disagrees:
“We believe this rationale failed adequately to take account of significant regulatory and competitive developments since 2017 when the Commission first considered, and denied, a national securities exchange’s application to list and trade shares of a spot Bitcoin ETP.”
In approving the Bitcoin futures ETFs, Grayscale believes that the SEC allowed applicants to sidestep the requirements from Section 6(5)(B) under the exchange act where the BTC Spot ETF applicants have to adhere to. The section is designed to protect the investors and the public interest by doing everything to prevent fraud and market manipulation while not allowing unfair discrimination between the issuers, customers, dealers, or brokers. Grayscale predicted that its Bitcoin spot ETF will be listed until July 2022, but it is still unclear whether the prediction will become reality. GBTC now has about $37.1 billion in assets under management.
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