A D.C. court has ruled in favor of Grayscale, the largest crypto asset manager, in its lawsuit challenging the U.S. Securities and Exchange Commission’s decision to deny the conversion of GBTC to a spot bitcoin exchange-traded fund (ETF). The securities regulator “failed to explain its different treatment of similar products,” said the Circuit judge presiding over the Grayscale-SEC case.
Court Sides With Grayscale Against SEC
The United States Court of Appeals for the District of Columbia Circuit ruled in favor of Grayscale Investments against the U.S. Securities and Exchange Commission on Tuesday regarding the company’s proposed bitcoin exchange-traded fund (ETF) conversion.
“The D.C. Circuit ruled 3-0 in favor of Grayscale and GBTC,” the crypto asset management firm wrote on the social media platform X. “This is a monumental step forward for all who have been advocating for bitcoin exposure through the added protections of the ETF wrapper.” Commenting on the court ruling, Grayscale CEO Michael Sonnenshein wrote:
The D.C. Circuit ruled in favor of Grayscale in our lawsuit challenging the SEC’s decision to deny GBTC’s conversion to an ETF!
Grayscale has been trying to convert its flagship bitcoin trust (GBTC) to a spot bitcoin ETF. However, the securities regulator has denied the crypto asset manager’s application. Grayscale subsequently filed a lawsuit challenging the Commission’s denial order.
So far, the SEC has not approved a spot bitcoin ETF even though the agency has greenlighted several bitcoin futures ETFs. A number of bitcoin ETF proposals have been filed with the regulator, including one by the world’s largest asset manager, Blackrock.
In its “petitioning for review of the Commission’s denial order,” Grayscale maintains that its proposed bitcoin ETF product “is materially similar to the bitcoin futures exchange-traded products and should have been approved to trade on NYSE Arca,” the court order shows.
Circuit Judge Neomi Rao, one of the three judges presiding over the Grayscale-SEC case, stated in the court order issued on Tuesday:
We agree. The denial of Grayscale’s proposal was arbitrary and capricious because the Commission failed to explain its different treatment of similar products. We therefore grant Grayscale’s petition and vacate the order.
What do you think about the Circuit Court siding with Grayscale against the SEC? Do you think the SEC will soon approve a spot bitcoin ETF? Let us know in the comments section below.
by Kevin Helms via Bitcoin News
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