If Grayscale’s Bitcoin Spot ETF Application Is Denied They Might Sue The SEC

Michael Sonneshein, the CEO of Grayscale said that they could consider a lawsuit against the U.S. Securities and Exchange Commission (SEC), if they deny Grayscale’s application for a Bitcoin spot ETF.

Grayscale has submitted an application with the SEC to convert its Grayscale Bitcoin Trust into a spot ETF, which would track Bitcoin as its underlying asset.

Sonnenshein, said in an interview with Bloomberg that his company would consider a lawsuit against the SEC, should the regulator deny its Bitcoin spot ETF application. To a question whether Grayscale would pursue an Administrative Procedures Act lawsuit against the SEC, Sonnenshein replied:

“I think all options are on the table.”

The Grayscale chief executive highlighted how important it is for people to reach out to the SEC in response to its request for public comments. Many have already done so.

The Securities and Exchange Commission has a July 6th deadline to decide whether it will allow for the conversion of the Grayscale Bitcoin Trust into a Bitcoin spot exchange-traded fund. According to Sonnenshein, Grayscale is allocating ‘full resources’ to get the application approved by the deadline.

The GBTC fund, which its 800,000 accounts in the United States. The Trust has traded since 2015, and Sonneshein pointed out that the Trust remaining as it is, instead of being converted into an ETF, puts investors at risk. He argued that the “ETF wrapper” would actually protect the investors, and from that point of view the SEC is not “doing everything [they] can to actually protect investors.”

According to Sonnenshein, the SEC’s approval of a Bitcoin futures ETF, along with President Biden’s recent executive order, are signs of progress. He believes that it’s only a matter of time before the SEC approves the long-awaited Bitcoin spot ETF.