The $20 Billion Delay: Appeal Court Pushes Back Decision On Grayscale Spot Bitcoin ETF
23 August 2023 - 9:20PM
NEWSBTC
The D.C. Circuit Court of Appeals was expected to give a ruling on
Grayscale’s Spot Bitcoin ETF lawsuit against the United States
Securities and Exchange Commission (SEC) on August 22 following its
failure to do so on August 18. However, the crypto community would
have to wait longer as the court has once again failed to make a
decision. Court Delays Spot Bitcoin ETF Decision For The Third Time
According to a tweet by Grayscale’s Chief Legal Officer Craig Salm,
the appeal court failed to make a decision regarding his company’s
lawsuit against the SEC. However, he pointed out that there were no
rulings for that day in what might be a move to quench any notion
that the court was intentionally stalling the case. Related
Reading: Rumors Of Robinhood Listing XRP Take Center Stage On
Crypto Twitter This marks the third delay of the much-anticipated
verdict, as the court had previously been expected to give a
decision on August 15 and then August 18. So it remains uncertain
when a decision could come next as legal experts had earlier
projected the court to give its verdict this month.
Grayscale’s lawsuit against the SEC dates back to last year when
the company reportedly tried to persuade the Commission to convert
its $20 billion Grayscale Bitcoin Trust (GBTC) to a Spot Bitcoin
ETF, which the SEC rejected. Following the rejection,
Grayscale sued the regulator, arguing that it had acted
indiscriminately by not giving its request the same treatment it
does to similar investment funds. Grayscale believes that
Spot Bitcoin ETFs should be approved like Bitcoin futures ETFs. In
its final oral argument in March, the crypto firm argued that the
SEC’s disapproval order against it was contradictory. It emphasized
the regulator’s inconsistency in denying a Spot Bitcoin ETF while
approving a Bitcoin futures ETF. The company further argued that
both investment vehicles pose the same risk of fraud and
manipulation. It also stated that the pricing of both futures and
spot bitcoin markets are “99.9% correlated,” which means they are
subject to the same risk. As such, since the SEC found the
CME’s surveillance sharing agreement sufficient enough to protect
against the risks in the futures market, it should be able to deem
it sufficient to approve Spot Bitcoin ETFs. BTC struggles to hold
bears at bay | Source: BTCUSD on Tradingview.com Why Grayscale’s
Case Could Be A Game Changer Grayscale is one of several financial
firms that have applied to the SEC to offer a Spot Bitcoin ETF.
Interestingly, the company filed this application while it awaits a
decision from the court regarding its lawsuit against the
SEC. Related Reading: Is Binance Really Selling Bitcoin To
Prop The Price Of BNB? However, considering that the SEC has
remained reluctant to approve these applications, a verdict in
favor of Grayscale could potentially force the hands of the
Commission to finally approve a Spot Bitcoin ETF. Such a
verdict will undoubtedly be a boost for the crypto industry as it
would pave the way for institutional investors to have direct
access to crypto assets, something which could further spur the
mass adoption of cryptocurrencies. Featured image from Coin
Culture, chart from Tradingview.com
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