Gensler Silent On The Stipulated Grayscale Appeal Midnight Deadline

In a latest update, the United States Securities and Exchange Commission (SEC) and its Chairman, Gary Gensler, who is keeping a shallow profile regarding the outcome of Grayscale’s proposal to transform its flagship fund, the Grayscale Bitcoin Trust (GBTC), into a spot bitcoin exchange-traded fund (ETF).

Following the SEC’s rejection of this proposal, Grayscale and its backers have been pitted against the regulatory body in a heated legal dispute. The GBTC has since restructured, reducing from 43%-16.5% in discount, signifying that the SEC may likely approve the spot BTC ETF.

Eleanor Terrett, an industry journalist with Fox Business, says that the SEC is yet to issue a public statement on their next line of action, as it concerns the latest lawsuit, and also has till midnight to appeal the case. As of press time, the SEC has yet to approve a spot BTC ETF, but the recent Grayscale judgment is perceived as a development for the companies that have applied for the spot BTC  ETFs for over a year. The major applicants include Fidelity and BlackRock.

SEC Fate In The Absents Of An Appeal Explained, Anxiety Grows

Commenting on this development, analysis on The Block news platform explained that if the SEC decides not to file an appeal, Grayscale would be given the go-ahead to transform its flagship fund into a spot Bitcoin ETF, opening up the cryptocurrency market to a more significant number of investors while providing them with the security of an ETF structure.

Recall that other major U.S. financial giants, like WisdomTree, VanEck, GlobalX, Franklin Templeton, ARK Investment, Invesco Galaxy, and more have also submitted applications to the SEC to develop a product comparable to Grayscale’s spot BTC  ETF.

News also states that the Security And Exchange Commission (SEC) is in a legal battle with Coinbase, Ripple Labs, and Binance. Terrett also stated that each case is important as it adds significantly to the future of cryptocurrency regulation in the United States and beyond.

Grayscale Writes SEC, Request For A Meeting On ETF

On the other hand, the SEC can decide to challenge the judge’s judgment, by starting a drawn-out legal conflict. This might increase tension between the Bitcoin sector and regulators and prolong the complexity around Grayscale’s plan.

It was gathered that Grayscale sent a letter to the SEC last month through their lawyers, requesting that they hold a meeting to talk about how they can convert Grayscale Bitcoin Trust into the spot BTC ETF. The latter, published on The Block news platform, read that Grayscale is asking the SEC to use its position to issue an order that approves the “New York Exchange Arca’s Rule 19b-4 filing.”

They’d asked SEC also to order their staff to assist New York Stock Exchange Arca and Grayscale company to finish the early listing of their Trust’s shares.” Terrett also explained that the case would be called to a close in seven days should the SEC fail to appeal the judgment before the stipulated deadline.

On the other hand, Grayscale will be working with two major departments in SEC, Trading and Markets (T & M) and the Division of Corporation Finance, to succeed in the approval process. According to a post made on the Winston & Strawn LLP blog platform in August, it is expected that the court follow up with the mandate and compel the SEC to approve the application by Grayscale.