US SEC: Rejection of GBTC's application to convert GBTC into a spot ETF "reasonable explanation and sufficient evidence"
This article comes fromThe BlockOdaily Translator | Nian Yin Si Tang
Odaily Translator | Nian Yin Si Tang
secondary title
briefing:
- Crypto asset manager Grayscale Investments said the U.S. SEC has filed its first legal brief in a lawsuit over the rejection of its application for a bitcoin spot exchange-traded fund (ETF).- In this 73-pageresponse briefing
, the SEC argued that its rejection was "reasonable, well-conceived, and supported by substantial evidence."
Grayscale Investments said the U.S. Securities and Exchange Commission (SEC) has filed its first legal brief regarding the rejection of the crypto asset manager’s application for a spot bitcoin exchange-traded fund (ETF)."This is the next milestone in our ongoing litigation, following our October 11 filing of, and a supportive amicus brief was filed shortly thereafter. ” the company said in a statement on Friday.express。
express
In opening arguments in October, Grayscale’s legal argument centered around what the company said was an unfair application of the law after regulators approved bitcoin futures tied to spot market pricing. The firm called the U.S. SEC’s decision in June to reject its application to convert GBTC into a spot bitcoin ETF as “arbitrary, capricious and discriminatory.” Grayscale filed a public legal brief as part of its lawsuit against the regulator. In the brief, the lawyers argued that because both bitcoin futures and spot bitcoin generate prices based on overlapping indices, the spot price of bitcoin in spot and futures ETFs is at the same risk: therefore, it is wrong to approve one and reject the other. Fair. The firm argued that the refusal harmed the 850,000 investors who already held shares in the trust.
In a 73-page response brief, the SEC argued that its refusal was "reasonable, rationalized, and supported by substantial evidence" and that "while two CME Bitcoin futures ETPs have been approved, the SEC's disapproval of Grayscale's spot ETP There is no contradiction."
Futures and spot-based bitcoin funds are "substantially different products," the SEC said.
"Unlevel playing field"
“The ETPs previously approved by the SEC only hold futures contracts registered with the CFTC and traded on the CME; therefore, the underlying assets of these ETPs will be subject to strong oversight.” The SEC explained, “Bitcoin spot markets, by contrast, are Decentralized and unregulated, petitioners do not present any supporting basis for concluding that CME oversight of futures trading is adequate to detect and deter fraud and manipulation targeting the bitcoin spot market to prevent fraud in Grayscale's products. Fraudulent and manipulative behaviour."
The U.S. SEC said its opposition to Grayscale’s proposed ETF did not reflect “inadmissible, value-based skepticism about bitcoin as an investment.”In response to the SEC filing, Grayscalereiterate
stated his point of view in his opening statement:
1. The SEC has created an unfair playing field for investors by approving bitcoin futures-based ETFs while continually rejecting spot bitcoin ETFs.
2. The SEC failed to comply with the Administrative Procedure Act (APA) and the Securities Exchange Act of 1934 when it approved a bitcoin futures ETF but rejected a spot bitcoin ETF.
3. The SEC did not articulate the basis for its different treatment of spot bitcoin ETFs and bitcoin futures ETFs — in fact, they created a “significant market test” that treated each product type inconsistently.
"We look forward to reviewing the SEC's response brief," the company said, noting that the next brief is due on January 13 and the final brief is due on February 3.
