Grayscale, a leading crypto fund manager, has called on the U.S. Securities and Exchange Commission (SEC) to approve all pending spot Bitcoin ETFs simultaneously, arguing that selective approval would grant an unfair advantage to certain proposals.
The request, articulated in a letter submitted by Grayscale’s Chief Legal Officer, Craig Salm, included their own application among the eight filings.
The letter proposed that the SEC could approve the spot ETFs based on precedents set for Bitcoin futures ETFs, as these fund types are closely linked.
Grayscale also refuted the SEC’s requirement for surveillance sharing agreements (SSAs) between the ETF providers and Coinbase, a leading crypto exchange, which aims to prevent market manipulation.
Recently, ETF filings from top financial companies, including Invesco, BlackRock, Valkyrie, VanEck, Wisdom, Fidelity, and ARK Invest, were updated to incorporate SSAs with Coinbase.
The SEC, in turn, had delayed the ETFs’ approval in June citing the absence of such agreements.
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However, Grayscale contends that these SSAs are not requisite or sufficient under SEC standards as Coinbase is not a registered securities exchange, broker-dealer, or futures exchange.
Grayscale emphasized that the approval of the ETFs would mark a considerable but positive shift in the SEC’s standard application, warning against any discriminatory ‘first-mover’ benefits to certain proposals.
The firm’s Grayscale Bitcoin Trust (GBTC) currently has close to a million investors, tracking Bitcoin’s price.
Conversion to an ETF could yield billions in investor value, making Grayscale question the SEC’s rationale in withholding GBTC investors from a spot Bitcoin ETF.
The SEC rejected Grayscale’s application to convert the GBTC into a spot Bitcoin ETF last June, leading to a lawsuit by Grayscale against the regulator.
Grayscale accuses the SEC of inconsistency in handling similar investment vehicles, considering it an arbitrary act.
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