Grayscale Expects SEC Concurrent Approval Of Bitcoin ETFs To Balance Competitive Advantage

Key Points:

• Grayscale urges the SEC to simultaneously approve bitcoin ETF registrations among competitors so that no one has an advantage.
• If the SEC decides to change course and approve one or more of the spot bitcoin ETF applications outlined above, “they must do so in a fair and orderly manner,” he said.
• The SEC previously rejected Grayscale’s application to convert the Grayscale Bitcoin Trust (GBTC) into an ETF but approved a number of bitcoin ETFs based on futures.

Cryptocurrency fund manager Grayscale urges the Securities and Exchange Commission (SEC) to approve all Spot Bitcoin ETF applications at once to avoid giving one party an advantage.

A July 27 post by Grayscale chief legal officer Craig Salm said their legal team had sent a letter regarding eight spot Bitcoin ETF filings and argued that the SEC should not select some of the applications for approval because it will give a more significant competitive advantage to the winner.

The SEC previously accepted the listed proposals, including Ark 21 Shares, Invesco Galaxy, iShares (BlackRock), Valkyrie, VanEck, WisdomTree, and Wise Origin (Fidelity).

Therefore, Grayscale believes that the US Securities and Exchange Commission (SEC) should approve all spot bitcoin exchange-traded fund (ETF) applications simultaneously, if it approves any, in order to ensure equal treatment of all applicants.

“As a disclosure-based regulator, the SEC should not pick winners and losers; instead, the SEC should continue to provide issuesrs with feedback or guidance consistently and equitably.”

Written statement.

In addition, the crypto regulator also emphasized that the SEC is ready to approve a spot bitcoin ETF based on its previous approval of a bitcoin futures ETF. The spot and futures markets of Bitcoin are closely linked (as evidenced by third-party studies showing a 99% correlation).

Grayscale added the recent custodial sharing agreements (SSAs) between Coinbase and spot ETF providers “are not a new idea” and stated that they will not meet SEC standards. If the SEC decides to change course and approve one or more of the spot bitcoin ETF applications outlined above, “they must do so in a fair and orderly manner,” the statement said.

The SEC previously rejected Grayscale’s application to convert the Grayscale Bitcoin Trust (GBTC) into an ETF but approved a number of bitcoin ETFs based on futures. Cryptocurrency fund manager filed a lawsuit against the SEC for refusing to convert last June.

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