U.S. SEC rejects Grayscale's spot bitcoin ETF

economictimes.indiatimes.com:

exchange-traded fund (ETF) by Grayscale, one of the world's biggest digital asset managers, on the NYSE Arca exchange. Grayscale responded with a legal challenge to the decision, the latest in a series of rejections of proposals for U.S. listings of spot bitcoin ETFs over the past year. The proposal to list the ETF did not meet the standard designed to prevent fraudulent and manipulative practices and protect investors and the public interest, the Securities and Exchange Commission (SEC) said in a filing https://www.sec.gov/rules/sro/nysearca/2022/34-95180.pdf.

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Grayscale proposed creating the ETF as a conversion of its Grayscale Bitcoin Trust. Intercontinental Exchange Inc owns NYSE Arca. The SEC said its disapproval did not rest on «an assessment of whether bitcoin, or blockchain technology more generally, has utility or value as an innovation or an investment.» Grayscale said that in response it had filed a lawsuit against the regulator and would argue that the SEC had violated the Administrative Procedure Act and Securities Exchange Act. In a statement it pointed to the SEC's approval of ETFs based on bitcoin futures. «If regulators are comfortable with ETFs that hold derivatives of a given asset, they should logically be comfortable with ETFs that hold that same asset,» it said. In rejecting more than a dozen proposals for spot bitcoin ETFs over the past year, the SEC has focused on a lack of surveillance-sharing agreements with a regulated market of significant size relating to the underlying assets. The price of bitcoin, the largest digital