The world’s largest digital asset manager Grayscale will reportedly file its arguments in court regarding the potential launch of a Bitcoin ETF in the US on March 7.
The United States Securities and Exchange Commission (SEC) will argue against this.
The lawsuit is coming
Grayscale has signaled its intentions to introduce an exchange-traded fund (ETF) that tracks bitcoin performance in the United States several times, but so far to no avail. The second refused the product’s launch in June of last year and doubled down on its decision several months later.
Craig Salm, Grayscale’s chief legal officer, argued in 2021 that the SEC might have a “clear view” about ETFs, but should have a “reasonable probability” about it. CEO Michael Sonnenshein went further, swearing sue the watchdog for dismissing the company’s initiative.
according to recent coverage, the Court of Appeals for the District of Columbia ordered both sides to meet in court on March 7 to present their views. Grayscale previously expected the legal battle will begin in the second quarter of 2023.
The digital asset manager started pursuing its goal after the SEC passed ProShares Bitcoin futures-backed ETF (called BITO) in October 2021.
The numerous accidents in the cryptocurrency industry in the past year have negatively affected Grayscale. Contrary to some exchanges that produced proof of reserves after the FTX fallout, refused do so, citing security reasons. The company also stated that its custodian partner, Coinbase, performs regular on-chain validation:
“Due to security concerns, we do not make such on-chain wallet information and confirmation data publicly available through a Proof of Crypto Reserve or other advanced cryptographic accounting procedure.”
Concerns have been raised that Grayscale could face additional problems because it falls under the umbrella of the struggling Digital Currency Group (DCG). One of its subsidiaries – Genesis – archived for bankruptcy protection now.
More success in Europe
Unlike its troubles with the US regulator, Grayscale introduced a crypto ETF to the European market last summer. The product, which tracks the “Bloomberg Grayscale Future of Finance Index”, consists of a range of companies that are part of the sector, including exchanges, miners, brokers, asset managers and technology companies.
The listing on the London Stock Exchange, the German Deutsche Börse Xetra and the Italian Borsa Italiana made the entity the first American digital asset manager to launch a fund of this type in the Old Continent.
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