Grayscale’s Push For Bitcoin ETF Conversion Faces SEC Hurdles

On January 13, the cryptocurrency investment firm Grayscale responded to the US Security and Exchange Commission’s (SEC) objections to turning its Bitcoin Trust (GBTC) into a spot BTC ETF.

According to a Bitcoin investment firm, the SEC’s claim that CME protects against fraud/manipulation in BTC futures but not spot markets is illogical.

Grayscale Alerts To Futures Impact Of Spot Price Fixing

The company claims that the rate of Bitcoin futures would be impacted by fraud or market manipulation on the spot. Moreover, Grayscale illustrated how the two goods are related and how changing one could change the other.

Either CME surveillance can detect spot-market fraud that affects both futures and spot ETPs, or that surveillance cannot do so for either type of ETP.

Craig Salm, chief legal officer at Grayscale, pointed out that the SEC arbitrarily used its major market test. The banking authorities apply the rule laxly for Bitcoin ETFs, according to Salm. To arrive at a result-driven conclusion, the same procedure is carefully used to spot bitcoin ETFs.

Furthermore, the test is unjustified, rewards BTC futures unfairly, and punishes spot bitcoin, says Salm.

According to the legal officer’s assessment, the firm’s plan to change its trust into a spot ETF is legitimate. He continued by saying that the ETF is intended to guard investors and the general welfare while preventing fraud and manipulation.

Additionally, the troubled cryptocurrency corporation Digital Currency Group owns Grayscale (DCG).

Osprey Investments’ Submission For The GBTC

GBTC has received a proposal from Greg King, the CEO of Osprey Fund. CEO sent an open letter to DCG CEO Barry Silbert on January 13. Requested identification of his fund as a sponsor.


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King stated that his fund would streamline the fund’s structure and reduce GBTC’s management cost to 0.49%. Additionally, the CEO announced that his company would launch a redemption program immediately and float it on the (NYSE).

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