Grayscale CEO has been pressing hard for the SEC to approve its spot Bitcoin ETF application. If the SEC decided otherwise, Grayscale is ready to take up a legal battle with the securities regulator.
The world’s largest digital asset manager Grayscale Investments LLC says that it has overwhelming public support for converting its Bitcoin Trust (GBTC) to a spot Bitcoin ETF. Grayscale said that there have been positive public comments on its spot Bitcoin ETF application to SEC.
In a letter to investors on Monday, June 27, Grayscale said that in more than 11,400 letters that the US SEC received for its proposed Bitcoin investment vehicle, “99.96 percent of those comment letters were supportive of Grayscale’s case”.
Out of those, 33% of the letter also questioned the lack of a spot Bitcoin ETF in the US Note that the SEC has already approved Bitcoin futures ETF. Currently, the SEC is reviewing Grayscale’s application submitted last November 2021, for converting its GBTC product to a spot Bitcoin ETF. The application is now nearing the end of the 240-day review process on July 6.
As the review process comes to its conclusion, Grayscale has been peddling hard to get the spot Bitcoin ETF approval. Speaking of the development, Grayscale CEO Michael Sonnenshein said:
“The SEC’s actions over the past eight months […] have signaled an increased recognition of and comfort with the maturity of the underlying Bitcoin market. The approval of each and every Bitcoin-linked investment product strengthens our arguments about why the U.S. market deserves a spot Bitcoin ETF.”
Will the US SEC Approve a Spot Bitcoin ETF?
Citing insufficient steps to control market manipulation, the US SEC has rejected several applications for the spot Bitcoin ETF in the past. Market analysts believe that the SEC is less likely to approve this time as well despite positive comments from the public.
Bloomberg ETF analyst Eric Balchunas said: “[In my opinion] the chances of GBTC being allowed to convert to an ETF next week are 0.5%. About the same odds the NY Jets have of winning the Super Bowl.”
However, Grayscale CEO Michael Sonneshein said that they are also ready for a legal battle with the SEC if the securities regulator doesn’t approve its application. He added:
next“We are also exploring options should the SEC not allow GBTC to convert to an ETF. Our legal team, including in-house counsel and our attorneys at Davis Polk, have articulated thoughtful, comprehensive arguments in support of GBTC’s conversion to an ETF”.