Grayscale Asset Manager has reportedly won its lawsuit against the US Securities and Exchange Commission (SEC), according to various sources. The legal action started in October 2022 after the SEC rejected Grayscale’s proposal for a spot Bitcoin exchange-traded fund (ETF). Grayscale’s legal team argued that the SEC’s denial was arbitrary and capricious and failed to provide adequate explanations. The recent court ruling means that the SEC must review its decision, potentially opening the door for approval of the first spot Bitcoin ETF in the US market
The court issued an order granting Grayscale’s petition and vacating the SEC’s previous decision to deny the asset manager’s proposal for a Bitcoin ETF. However, the SEC still has an opportunity to appeal the ruling within 45 days, which could lead to further legal proceedings. Alternatively, even if the SEC does not appeal, it still has the option to reject the application on other grounds, meaning that the outcome of this case is not yet certain.Copy
WHAT DID THE COURT SAY?
The judges on the court panel have stated that Grayscale’s proposal for a bitcoin ETF is significantly similar to the approved bitcoin futures ETFs. This is due to the correlation between the underlying assets, bitcoin and bitcoin futures, and the identical surveillance agreements with the CME that should effectively detect any fraudulent or manipulative conduct in the bitcoin market.
As a result, the court has ruled that the rejection of Grayscale’s filing by the SEC was “arbitrary and capricious” as the SEC failed to provide a clear explanation as to how Grayscale owning bitcoins in contrast to bitcoin futures would impact the CME’s ability to detect fraud.
BITCOIN PRICE IS PUMPING NOW
Bitcoin rises to $27,400 after Grayscale wins lawsuit against SEC.
