Grayscale sues SEC after rejection of bid to turn the largest bitcoin fund into an ETF
The watchdog is concerned investors would lack sufficient protections under the Grayscale proposal.
Grayscale filed to make its Bitcoin Trust, known as GBTC, an ETF back in October 2021, but the ruling faced multiple delays. Grayscale had piled pressure on the watchdog to side with it, including by giving people a way of quickly emailing in to express their support.
Soon after the SEC’s rejection, Grayscale filed a petition challenging the decision with the U.S. Court of Appeals for District of Columbia Circuit. The litigation is being led by Grayscale’s senior legal strategist Donald B. Verrilli Jr., a former U.S. solicitor general, and a team of attorneys at law firm Davis Polk & Wardwell.
Verrilli said 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.”