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Digital Assets

Greyscale’s Battle with the SEC over the GBTC ETF Conversion


Hugh Meyer

Greyscale’s Battle with the SEC over the GBTC ETF Conversion

  • Greyscale Investments has been in a long battle with the SEC to convert its widely held bitcoin investment vehicle, GBTC to an ETF structure
  • The SEC has continued to push back on the conversion, offering little reason as to why

This past week, Coinbase and prominent lobbyist, Blockchain Association, filed amicus briefs within the lawsuit to support the efforts of Greyscale. Moreover, US Chamber of Commerce lawyers wrote in an amicus brief filed this past week—that the SEC’s decision to deny Grayscale’s fund conversion reflects “a paternalistic belief that the agency knows better than investors.” The SEC, which claims to directly represent 300,000 members, added that the agency’s policy decisions often “depart drastically” from SEC precedent.

  • The SEC is leveraging their position by way of the Administrative Procedure Act, which is a Congress approved act to provide authority to the SEC in cases such as this one
  • The SEC will respond to the briefs filed by November 9

Why this matters to you:

We have spent a great deal of time discussing the importance of a regulatory framework for Digital Assets. This is magnified by the controversy surrounding the conversion of GBTC to a liquid, and transparent ETF structure. The bi-partisan Congressional leadership and comprehensive bill proposals will continue to push the ball forward into 2023.

Disclaimer: Always seek professional financial advice before investing. This content is for informational purposes only and is not a solicitation or offer to purchase cryptocurrencies. You should not construe the above content as tax, financial or legal advice. Trading cryptocurrencies carries a high level of risk and may not be suitable for all investors. Before deciding to trade cryptocurrency, you should carefully consider your investment objectives, level of experience, and risk appetite.  The possibility exists that you could sustain a loss of some or all of your investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with cryptocurrency trading and seek advice from an independent financial advisor.
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