U.S. federal appellate court judges questioned on Tuesday whether the U.S. Securities and Exchange Commission (SEC) was correct to reject Grayscale Investment’s application for a spot bitcoin exchange-traded fund, since the agency had previously approved bitcoin futures products.
The SEC rejected Grayscale Investment LLC’s application to convert its flagship spot Grayscale Bitcoin Trust into an exchange-traded fund (ETF) last June, arguing the proposal did not meet anti-fraud and investor protection standards.
A panel of judges in the District of Columbia Court of Appeals in Washington pressed the SEC on Grayscale’s argument that, because the regulator previously approved certain surveillance agreements to prevent fraud in bitcoin futures-based ETFs, the same setup should also be satisfactory for Grayscale’s spot fund, since both spot and futures funds rely on bitcoin’s price.
Source: US court questions SEC’s rejection of Grayscale’s bitcoin fund proposal | Reuters
