All About Grayscale Suing SEC Over Bitcoin ETF Application Rejection

All About Grayscale Suing SEC Over Bitcoin ETF Application Rejection

The world's biggest digital currency asset management firm, Grayscale Investments announced on June 29 that their Senior Legal Strategist Donald B. Verrilli, Jr., has filed a petition for review with the U.S Court of Appeals for District Columbia Circuit!

The petition for review challenges the decision made by the SEC to reject the conversion of Grayscale Bitcoin Trust (BTC) (OTCQX: GBTC) into a spot bitcoin ETF, as per a GlobeNewswire report.

On the matter, Grayscale's CEO, Michael Sonnenshein, said:

"Grayscale supports and believes in the SEC's mandate to protect investors, maintain fair, orderly, and efficient markets and facilitate capital formation — and we are deeply disappointed by and vehemently disagree with the SEC's decision to continue to deny spot Bitcoin ETFs from coming to the U.S. market." 

Meanwhile, Donal Gray's Grayscale's Senior Legal Strategist and also a former U.S Solicitor General has this to say:

"As Grayscale and the team at Davis Polk & Wardwell have outlined, the SEC is failing to apply consistent treatment to similar investment vehicles, and is therefore acting arbitrarily and capriciously in violation of the Administrative Procedure Act and Securities Exchange Act of 1934."

Grayscale Continues To Work Tirelessly On Spot Bitcoin ETF

With the goal of being "the world's biggest investment vehicle for Bitcoin," Grayscale has been working tirelessly to develop the GBTC since 2013.

The company has taken a proactive step in the right direction by submitting registration statements to increase transparency for investors. This will allow them greater monitoring from SEC officials and expose these products at an earlier stage of production, reducing risk as much as possible before it becomes reality

The digital currency asset management firm has also been quite aggressive in its efforts to provide investors with thorough disclosures and risk factors about GBTC, and its other cryptocurrency investment products.

During the 240-day review period, Grayscale ran a comment letter campaign. With a breathtaking 11,400 submissions to the SEC and over 99% expressing support for conversion- it's no wonder that this comment letter broke the record.

Discussions Of Suing the SEC Come True

It was reported that Grayscale could sue the SEC if their spot ETF application is denied on June 7. 

These indications are supported by the fact that Grayscale incorporated former US Attorney General Donald B. Verrilli Jr, who served in that position between 2011 and 2016, into his legal team.

In this regard, the senior ETF analyst for Bloomberg, Eric Balchunas, details that this fact that may have been overlooked by many is a clear indicator that Grayscale contemplates the option of suing the SEC if it does not approve its application for a Bitcoin ETF. 

Examining Verrilli's profile and background, it is known that the former prosecutor has extensive experience working with the government on a large number of cases that reached the Supreme Court. Therefore, it is a very good step for Grayscale to have added him to their ranks if the scenario of a lawsuit against the SEC arises.

Verrilli currently holds the position of senior strategist for the application of the Bitcoin ETF presented by Grayscale, so he will make all his expertise available to the company to advise it on its way to converting the Grayscale Bitcoin Trust into an exchange-traded investment fund. of values.

Let us remember that this is in addition to the statements by the CEO of Grayscale, Michael Sonnenshein, who months ago reported in an interview for Bloomberg that the option of a lawsuit was on the table, precisely because he considered that the government entity would be acting unfairly by denying the application for a Bitcoin ETF.

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