• Grayscale CEO Michael Sonnenshein discussed the importance of a spot Bitcoin ETF in an interview on „What Bitcoin Did“.
• Grayscale filed a lawsuit against the U.S. Securities and Exchange Commission after their application to convert GBTC to a spot Bitcoin ETF was rejected in mid 2022.
• Sonnenshein expects a decision by the fall of 2023 and oral arguments for the case will begin on 7 March.
Grayscale’s Lawsuit Against SEC
Grayscale Investments, a leading digital asset manager, filed a lawsuit against the U.S. Securities and Exchange Commission (SEC) in June 2022 after their application to convert its Grayscale Bitcoin Trust (GBTC) into a spot Bitcoin exchange traded fund (ETF) was rejected by the securities regulator in mid 2022. The company is now looking for legal recourse as it believes that when an agency like the SEC treats two similar issues differently, it violates the U.S administrative procedures act.
The Importance of Spot Bitcoin ETF
In an hour-long interview on “What Bitcoin Did”, Michael Sonnenshein, CEO of Grayscale Investments, discussed various matters related to his company including the importance of having a spot Bitcoin ETF instead of GBTC which has been trading at 45% discount to its net asset value due to lack of arbitrage mechanism. According to him, converting GBTC into an ETF would ensure that its share price remains in line with its underlying asset while avoiding any discounts or premiums as seen currently with GBTC shares.
Relationship With Genesis
Michael Sonnenshein clarified that his firm did not have any operational reliance on Genesis which was undergoing chapter 11 bankruptcy proceedings at press time and thus does not affect its legal proceedings against SEC either way.
Oral Arguments for Lawsuit
The oral arguments for the lawsuit will begin on 7 March this year and according to Michael Sonnenshein’s expectations there should be some sort of decision by fall 2023 – if they lose their appeal they may go for re-appeal in United States Supreme Court too..
GBTC Investors Counting On Grayscale
Speaking about why investors are counting on them despite all obstacles he said: “We have now over a million investor accounts that own GBTC, (from) all 50 states, GBTC investors all over the world, that are counting on us to do the right thing for them.“