• Grayscale Investments LLC participated in oral arguments on Tuesday in the US Court of Appeals for the DC Circuit, arguing to get its popular Grayscale Bitcoin Trust (GBTC) converted to a spot bitcoin ETF.
• The SEC has rejected previous attempts at introduction of a spot bitcoin ETF and Grayscale is suing the SEC for what it sees as arbitrary and inconsistent decisions.
• During the oral arguments, judges Chief Judge Sri Srinivasan and Judge Neomi Rao questioned Emily Parise from the SEC about why it had denied approval for spot bitcoin ETFs without providing evidence.
Grayscale Argues for Spot Bitcoin ETF
Grayscale Investments LLC argued in an oral hearing on Tuesday before the United States Court of Appeals for the DC Circuit that its popular Grayscale Bitcoin Trust (GBTC) should be converted into a spot bitcoin exchange-traded fund (ETF).
SEC Has Repeatedly Denied Approval
The U.S. Securities and Exchange Commission (SEC) has repeatedly denied previous attempts at introducing a spot bitcoin ETF, leading to Grayscale suing them alleging their decisions have been arbitrary and inconsistent with their approval of Bitcoin futures ETFs.
Judges Question SEC Senior Counsel
During these oral arguments, judges Chief Judge Sri Srinivasan and Judge Neomi Rao prodded Emily Parise from the SEC about the difference between a futures ETF and a spot bitcoin ETF, asking “Where’s the gap, in the Commission’s view?”. Parise responded that correlation does not equal causation and without empirical proof that fraud or manipulation in one market affects another there can’t be surety that CME surveillance would approve a spot ETF.
SEC Lacking Evidence
Judges were unsatisfied with this response, with Rao telling Parise that “The SEC has not offered any explanation that the petitioners are wrong.” This implies that they are lacking sufficient evidence to back up their decision making process.
Full Record Available Here
For those interested in further details of these discussions, you can listen to a full record of questioning here.