Grayscale won a lawsuit against the US Securities and Exchange Commission (SEC). The verdict reverses the SEC’s decision and sends the company’s application for a spot Bitcoin ETF for review.
Grayscale’s crypto funds hold $21 billion of assets, and GBTC remains the firm’s largest trust. The fund was launched in 2013 and since 2017 the company has been trying to convert it into a spot exchange-traded fund, but the SEC has been adamant, rejecting all of the company’s applications. Grayscale Investments sued the regulator in 2022.
The Court of Appeal ruled on August 29 that the decision to refuse to convert GBTC into a spot ETF must be reversed and the SEC must reconsider the application. Bitcoin immediately reacted to the verdict with a noticeable increase – rising in price by almost $1,500 to $27,400.
“The rejection of Grayscale’s proposal was arbitrary and capricious because the SEC was unable to explain its differing treatment of similar products. We therefore grant Grayscale’s motion and vacate the regulator’s order,” the court said in a statement.
The SEC now has 45 days to request a full appeals court hearing, with three judges. Only after this new meeting of the court or the expiration of the term, the verdict will be considered to have entered into force. The regulator has accumulated more than a dozen applications for spot bitcoin ETFs.
