Grayscale Bitcoin Trust: Lawyers representing Grayscale opened the arguments saying the SEC had contradicted its own earlier orders when it comes to approving the GBTC spot Bitcoin ETF. Don Verrilli, the company’s attorney, said the SEC’s rejection was an arbitrary decision, considering the existence of Bitcoin futures contracts.
Oral arguments began in Grayscale’s lawsuit challenging the SEC’s decision to deny its application to convert Grayscale Bitcoin Trust (GBTC) into a spot Bitcoin ETF. Arguments in the lawsuit were heard in front of the District of Columbia Court of Appeals. Grayscale’s argument in the case was based on allegations that the SEC violated the Administrative Procedure Act and Securities Exchange Act. By doing so, the company argues, the SEC was unfair to Grayscale after it had approved the futures ETF.
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The Denial
The clash began in June 2022, when the U.S. Securities and Exchange Commission (SEC) denied the spot ETF application. In a latest development, Alameda Research, a subsidiary of crypto exchange FTX, filed a lawsuit against Grayscale, a day before oral arguments in the SEC Vs Grayscale case began. The Alameda lawsuit alleged the company of unreasonably charging management fees for operating and administering the GBTC and Ethereum Trusts.
On Monday, the Grayscale Bitcoin Trust (GBTC) share price closed with a rise of 4.62%, in a sign of confidence in the company’s stance in the lawsuit. The company’s lawyers said the case rests on the fact that the SEC treated its application differently.
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