A new letter to America’s top financial regulator pours cold water on a wave of new spot bitcoin ETF applications.
Grayscale is a digital assets fund manager company, a subsidiary of the Digital Currency Group(DCG). For two years, the Grayscale team has been trying to convert its Green Bitcoin Trust (GBTC) fund into a Bitcoin spot ETF but its application was rejected by the United States Securities Exchange Commission (SEC). In response, the Grayscale firm sued the SEC agency for not approving its Bitcoin spot ETF application, while approving Bitcoin futures ETF products which are not safe over Bitcoin spot ETF products.
On 27 July 2023, The Grayscale lawyer penned a letter to the US SEC to address the problem with bitcoin spot ETFs applications, submitted by other fund managers companies.
The letter noted that the Coinbase exchange can’t be used as a surveillance platform for any spot ETF product because the Coinbase exchange itself is not registered with any market regulators as either a national securities exchange, broker-dealer, or futures exchange.
In short, the Grayscale lawyer is trying to bring a new road bump in the path of regulatory approval for the Bitcoin spot ETF applications, which are currently on the SEC’s table.
Earlier this, the SEC agency rejected huge numbers of Bitcoin spot ETFs. At the time, the agency claimed that such products are not very transparent and people can misuse or manipulate the price.
To kick out any kind of price manipulation or fraud-like activities, some of the fund managers established partnerships with the Nasdaq exchange & Coinbase crypto exchange to keep their corresponding Bitcoin spot ETF products under surveillance. In short, these fund managers are trying to show that they will make sure that their products will remain always transparent & manipulation free and this is the reason that the SEC body should give a green signal to the request.
Read also: SEC chairman says crypto is highly speculative
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