STAMFORD, Conn., Oct. 11, 2022 (GLOBE NEWSWIRE) — Grayscale Investments®the world’s largest digital currency asset manager, today filed in the U.S. Circuit Court of Appeals for the District of Columbia Circuit its opening brief challenging the Securities and Exchange Commission’s (“SEC” or “the Commission”) decision to convert from to deny greyscale bitcoin trust (BTC) Conditions to a spot bitcoin ETF*.
The opening letter explains the legal basis for Grayscale’s arguments. On June 29, 2022, the SEC denied Grayscale’s request to convert GBTC to a spot ETF. On the same day, Donald B. Verrilli, Jr., Grayscale’s senior legal strategist, former US Attorney General and partner at Munger, Tolles & Olson, filed a request for review to begin the litigation.
Today’s Executive Summary sets out why the SEC’s differential treatment of these products was arbitrary, discriminatory and beyond the Commission’s statutory powers; It also argues that the test the SEC has applied to bitcoin-related ETFs and only bitcoin-related ETFs is flawed and has been applied inconsistently with a “particular rigor” to identify bitcoin ETFs.
“Although Bitcoin may be a relatively new asset, the legal issue here is simple,” the letter explains.
In 2021 and 2022, the SEC approved several bitcoin futures ETFs but repeatedly rejected ETFs that directly hold bitcoin or recognize bitcoin ETFs, including Grayscale’s request to convert GBTC. The letter highlights that both bitcoin futures and spot bitcoin generate their price based on overlapping indices, so the spot price of bitcoin in each product is subject to the same risks and safeguards.
“This crass arbitrariness cannot be justified or reconciled with the Commission’s mandate to treat like cases equally. Rather, it can only be construed as a substantive judgment on the merits of a spot bitcoin investment — the kind of substantive judgment that is outside the powers of the Commission,” the brief reads.
“The Administrative Procedures Act…
