In a recent interview, the CEO of Grayscale InvestmentsMichael Sonnenshein, stated that “cannot imagine” why the United States Securities and Exchange Commission (SEC)for its acronym in English) “wouldn’t want” to protect Grayscale investors and return real asset value to them.
In an interview on February 25 in What Bitcoin Dida popular podcast hosted by Peter McCormack, Sonnenshein explained that the SEC “violated administrative procedures law” by denying approval for Grayscale Bitcoin Trust (GBTC) to be a spot Bitcoin (BTC) exchange-traded fund (ETF).in June 2022.
He explained that this law guarantees that the regulator does not show “favouritism” or act “arbitrarily”, adding that the SEC acted “arbitrarily” in approving bitcoin futures ETFs while rejecting “GBTC conversion”.
Sonnenshein noted that when the SEC began approving the first bitcoin ETFs, Grayscale took it “as a sign” that the SEC was “changing its attitude towards bitcoin”.
Said there is a “couple of billion dollars” of capital that would immediately return to the pockets of investors, “overnight”if GBTC were approved as a spot bitcoin ETF, as the fund would “bleed” down to its net asset value (NAV).
Sonnenshein explained that this is because GBTC is currently trading at a discount to its NAVbut if it were to become an ETF, there would “no longer” be a discount or premium; there would be a built-in “arbitration mechanism”.
He reiterated that Grayscale is in the process of “suing the SEC now”and could have a decision challenging the SEC’s denial of its initial application by “fall 2023.”
He also noted that Grayscale has over a “million investor accounts”with investors from all over the world that they count on the company to “do what’s right for them”.
sonnenshein “can’t imagine” why the SEC wouldn’t want to “protect investors” and “give them back that value”.
He added that Grayscale will not “shrink” from the fact that it has a “commercial interest” in this approval, noting that if the request to challenge the SEC is denied, Grayscale could appeal the case to the US Supreme Court.
This comes after the SEC filed a 73-page brief with the United States Court of Appeals for the District of Columbia in December 2022 outlining its reasons for denying Grayscale’s request to convert its $12 Bitcoin Trust. billion in a spot-based bitcoin ETF in June 2022.
The SEC based its decision on the conclusions that the Grayscale proposal did not sufficiently protect against fraud and manipulation..
The agency had reached similar conclusions in several previous applications. for the creation of spot bitcoin ETFs.
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