Grayscale Files Brief in ETF Suit Against SEC, Oral Contentions Might Come in Practically No Time

Grayscale Appealed the SEC’s denial of its Application to create a spot BTC ETF in June; the case “is moving quickly,” according to the Grayscale chief legitimate officer.

Grayscale filed a reply brief in its appeal of the US Securities and Exchange Commission (SEC) denial of its application to convert its $12-billion Grayscale Bitcoin Trust (GBTC) into a spot-based Bitcoin exchange-traded reserve (ETF). The concise, filed in the Locale of Columbia Circuit Court, tended to focuses made in the SEC reply brief filed in December and restated its own arguments.

The SEC based decision on findings Grayscale’s proposal didn’t sufficiently protect against fraud and manipulation. The organization had made similar findings in various earlier applications to create spot-based BTC ETFs.

1/ As part of our suit challenging the SEC's decision to deny $GBTC conversion to a spot #bitcoin #ETF, @Grayscale just filed our Reply Brief with the DC Circuit Court of Appeals. Here’s what you need to know:
— Craig Salm (@CraigSalm) January 13, 2023

Grayscale countered the denial with claims in court that the SEC had acted randomly in treating spot traded exchange-traded items uniquely in contrast to futures traded items. Grayscale stated in its brief that there is a correlation between prices in the futures market and the spot market.The SEC had exceeded its authority.

“The Commission isn’t allowed to choose for investors whether certain investments have merit – yet the Commission has done precisely that, to the detriment of the investors and potential investors it is charged to protect.”

“Grayscale chief legitimate officer Craig Salm said in a tweet, “The case is moving quickly. While timing is questionable, oral arguments might be when Q2 [2023].” Grayscale applied to the SEC in October 2021, and the office rejected that application on June 29.
Fir Tree Capital Management sued Grayscale on Dec. 6 requesting, in addition to other things, that Grayscale surrender its appeal of the SEC decision.“That strategy will likely cost years of litigation, a huge number of dollars in lawful fees, countless long stretches of lost management time, and generosity with regulators, according to the complaint.”

Grayscale is possessed by the Digital Currency Group, which is presently going through a Financial crush.