SEC being 'objectively unreasonable' by denying spot Bitcoin ETFs
Grayscale Investments CEO Michael Sonnenshein said that US regulators were "discriminating" against his cryptocurrency investing firm by continuing to deny licensing for exchange-traded funds based on Bitcoin's current price (BTC-USD).
Grayscale had filed a lawsuit against the US Securities and Exchange Commission after the regulatory body declined the firm's registration for a Bitcoin ETF.
Sonnenshein told CNBC, "The SEC is acting arbitrarily and capriciously by continuing to allow Bitcoin futures ETFs while continuing to deny spot Bitcoin ETFs."
Grayscale's CEO, who runs the Grayscale Bitcoin Trust (OTC: GBTC), promised investors that the company was completely committed to pursuing its legal alternatives in order to force SEC clearance.
"We are not going to stop. We're going to put the full resources of the firm behind this lawsuit," he stated.
Sonnenshein stated that allowing a spot Bitcoin ETF would help build a better regulatory framework around the cryptocurrency market, ultimately giving additional protections for investors, calling the SEC's decision "an unbelievably missed opportunity."
"A U.S. regulator is shunning the opportunity to bring this further into the regulatory perimeter and give investors more disclosure, more protections," he claimed.
While Grayscale has long sought clearance for its Bitcoin ETF, the latest developments come at a critical juncture in the cryptocurrency market. Bitcoin (BTC-USD) has dropped sharply in 2022, from a high of about R1.134 million in 2021 to a level near R312k currently.
Meanwhile, the value of other cryptocurrencies has plummeted considerably. The price of Ethereum (ETH-USD) has dropped from a peak above R80.5k to slightly above R16.4k. At the same time, Litecoin (LTC-USD) and Solana (SOL-USD) have experienced comparable reductions, decreasing by approximately 67 % and 82 %, respectively, in 2022.
Even though the SEC has rejected ETFs based on the spot price of Bitcoin (BTC-USD), there are funds that provide investors with indirect access to cryptocurrency movements. Roundhill Investments recently filed for a Bitcoin futures-based ETF, joining a growing collection of similar funds already on the market.
Proshares Bitcoin Strategy ETF (BITO), Valkyrie Bitcoin Strategy ETF (BTF), and VanEck Bitcoin Strategy ETF are among these funds (XBTF).
