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Does the SEC Have a Favorite Spot Bitcoin ETF? Grayscale Questions SEC

Grayscale Investments has submitted a letter to the SEC voicing opposition to any preferential treatment to new spot BTC ETF applicants, warning of an unfairly prejudicial first-mover advantage.

Does the SEC Have a Favorite Spot Bitcoin ETF? Grayscale Questions SEC

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Grayscale Investments is urging the U.S. SEC to prevent what it terms an “unfairly discriminatory and prejudicial first-mover advantage,” for potential Bitcoin ETF issuers:

Grayscale, which is currently in a legal dispute with the SEC following the regulator’s refusal to allow the conversion of its Bitcoin Trust to an ETF, outlined its stance in a letter penned by a legal representative:

“As a disclosure-based regulator, the SEC should not pick winners and losers; instead, the SEC should continue to provide issuers with feedback or guidance consistently and equitably.”

This development comes after applications by BlackRock, Valkyrie, Invesco and others introduced a Spot Bitcoin ETF application to the SEC, which appears to have spurred additional applications upon the SEC rejection.

In an SEC filing, Nasdaq recently disclosed that it reached terms for a surveillance-sharing agreement with Coinbase concerning the listing of BlackRock’s proposed ETF. Other exchanges, such as Cboe, have included similar language in their proposals.

Grayscale’s Chief Legal Officer, Craig Salm, opined that the SEC is now in a position to approve Bitcoin ETPs as it had previously given the nod to Bitcoin futures ETFs.

Grayscale is advocating for the simultaneous approval of all Bitcoin ETF proposals, fearing that only sanctioning the most recent applicants would suggest a drastic shift in the SEC’s application of regulatory standards:

“Although Grayscale strongly supports a Commission approach that would facilitate approval of all spot bitcoin ETP proposals, approving only the above-referenced proposals would reflect a positive but sudden and significant change in the Commission’s application of the relevant statutory standard.”

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