Crypto hedge fund Grayscale informs the US Securities and Exchange Commission (SEC) that it is abandoning Bitcoin (BTC) exchange-traded funds (ETFs) are “irrational.”
Grayscale responded to a brief filed by the SEC last month he says Converting Greyscale Bitcoin Trust (GBTC) to a spot BTC ETF will greatly benefit traders by unlocking value and increasing investor protection.
“For more than 850,000 investors, turning GBTC into a spot Bitcoin ETF will unlock more than $4 billion in value by providing the product with the regulatory relief needed to create and redeem shares simultaneously, allowing arbitrage to take into account both stock premiums and discounts.” compared to net asset value.
The conversion will also subject trading in GBTC to enhanced regulatory standards and strengthen investor protection. The SEC’s reluctance to add Bitcoin to the regulatory perimeter through a spot Bitcoin ETF has prevented US investors from getting the Bitcoin investment exposure they both want and deserve.
First, gray color Sweden In June 2022, the SEC. Firm in October 2022 application it is claimed the regulator showed bias when it rejected a hedge fund’s Bitcoin ETF proposal in June.
In the lawsuit, Grayscale claims that the SEC’s approval of other BTC-related products, such as the Chicago Mercantile Exchange (CME) BTC futures ETF, is inconsistent with its rejection of Bitcoin ETFs.
In a formal court filing, Grayscale apply The SEC’s decision to issue a futures BTC ETF on the CME based on its level of security is considered “illogical” because the same type of security is required to operate a BTC ETF.
“The Order in this case is essentially arbitrary. Its central premise—that the Exchange’s control-sharing agreement with the CME provides adequate protection against fraud and manipulation in the Bitcoin futures market, but not the spot Bitcoin market—is illogical.
Any fraud or manipulation in the spot market will definitely affect the price of Bitcoin futures, thereby affecting the net asset value of the ETP. [exchang-traded product] owning either spot Bitcoin or bitcoin futures, as well as the price investors pay for shares of such an ETP.
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