Grayscale Investments encourages the Securities and Exchange Commission (SEC) to approve all the filed applications for a spot Bitcoin ETF (Exchange Traded Fund). The asset management agency made this persuasion to the American Regulator in a letter and highlighted that this is to avoid having a “first mover advantage.” The Chief Legal Officer of Grayscale, Criag Salm, stated in a post that its legal team submitted a letter regarding Bitcoin ETFs.

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Earlier, Grayscale’s ETF received no affirmation from the SEC and now the firm is asking that the regulator should not play winners and losers. It says that all EFTS should be approved together to avoid giving an advantage to some. In its letter, the firm claimed that the SEC could endorse the spot ETFs in the same manner as it did for the BTC Futures.

Notes from before:
According to the investment firm, in its letter dated July 10, it began to trade on June 27 without interference from the SEC. However, the regulator has yet to approve any of the listed spot crypto ETFS but has approved those that are connected to BTC futures. Grayscale claimed that the two fund types are “inextricably linked.”

“The fact that the Commission has allowed a leveraged bitcoin futures ETP to begin trading demonstrates that the Commission continues to arbitrarily treat spot bitcoin ETPs differently than bitcoin futures,” said Grayscale.
Stating that volatility shares ETFs are riskier investments than BTC Futures ETFs, Grayscale’s legal team filed against the SEC after the commission refused an application to convert its Grayscale Bitcoin Trust into a spot Bitcoin ETF.

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Coinbase and SEC Approval

Many other investment asset managers are waiting on the SEC’s approval for their ETF applications. They include Invesco, BlackRock, Valkyrie, Vaneck, Wisdom, Fidelity and ARK Invest. They have adopted surveillance sharing agreements (SSAs) with United States-based cryptocurrency exchange Coinbase.
SSAs are requested by the commission as it makes it easier to observe the market and spot irregular trading activities. However, it is not clear if the commission would be satisfied with Coinbase since the crypto firm is not registered with the commission and is currently in a legal scuffle with the SEC. This was the view of Grayscale as well. There have been some lawsuits against Coinbase by the commission and while it remains pending, it is unlikely that the commission would approve Bitcoin ETF applications related to Coinbase.

However, Grayscale’s chief legal officer, Salm thinks that approving spot Bitcoin ETFs would be a positive and significant change for the SEC, and it would be unfair to play favourites, that “improperly grant an unfairly discriminatory and prejudicial first-mover advantage to these proposals.” if it does not approve all ETFs simultaneously.

Sec had rejected the investment agency’s application on the assertion that Grayscale lacked sufficient information on how it intended to protect investors from “fraudulent and manipulative acts and practices”.

What is at risk:

Grayscale Bitcoin Trust (GBTC) already has nearly 1 million investors according to Salm. He claims that GBTC intends to track Bitcoin Price and if converted to an ETF, it is expected to return billions in return to investors.

Written By Nwogu Ihuoma

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