Grayscale Would Consider APA Lawsuit if SEC Rejects its Bitcoin ETF Conversion Application, Says CEO
The US-based major cryptoasset management firm Grayscale CEO Michael Sonnenshein has suggested that the fund manager may take legal actions against the US Securities and Exchange Commission (SEC) if the agency rejects the former's bid to convert its Bitcoin (BTC) trust into an exchange-traded fund (ETF).
“I think all options are on the table come July,” Sonnenshein said in an interview with Bloomberg after the reporter asked him whether he "would look into the option of an APA lawsuit."
According to Patel Law Group, filing a Federal Lawsuit under the Administrative Procedure Act (APA) is a way in which groups or individuals can "challenge unlawful agency action."
The SEC's deadline to rule on Grayscale's proposal to convert its flagship fund, Grayscale Bitcoin Trust (ticker GBTC), into a spot Bitcoin ETF is July 6.
Grayscale first filed an application to convert the GBTC fund into a spot bitcoin ETF in April 2021. Now, the world’s largest digital currency asset manager said it remains committed to doing so.
“The Grayscale team has been putting the full resources of our firm behind converting GBTC, our flagship fund, into an ETF,” Sonnenshein said. “It’s really important that investors know that we have and will continue to advocate for them.”
In early February, the SEC issued a notice asking for public comment regarding Grayscale’s application. According to the fund manager, investors have shown support for the product with around 2,700 letters submitted to the SEC so far.
Notably, the SEC has approved Bitcoin derivatives-backed ETFs. However, the agency has remained skeptical of a physical Bitcoin ETF, consistently denying applications. In its denials, the regulatory body has cited concerns about the potential for fraud and
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