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The US Securities and Exchange Commission (SEC) is reportedly in talks with Grayscale regarding the details of its application to convert its application to convert its Grayscale Bitcoin Trust (GBTC) into a spot Bitcoin ETF. 

According to a report by crypto media platform CoinDesk, Grayscale Investments has been in contact with the securities agency’s Division of Trading and Markets and its Division of Corporate Finance after a recent courtroom victory ordered the SEC to review Grayscale’s spot bitcoin exchange-traded product (ETF) filing. 

A Possible Milestone in the Making

The report cites a person familiar with the communication who opted to remain anonymous as the talks between the SEC and Grayscale remain private. The media has been flooded with discussions of the SEC possibly approving one of the strings of recent spot Bitcoin ETF applications. An approval from the SEC for a spot BTC ETF would be a momentous occasion in the digital asset market and would ease everyday investors’ access to digital assets.  

In August, three judges in the US Court of Appeal for the DC Circuit ruled that the agency must review Grayscale’s spot bitcoin ETF application. The asset manager sued the SEC last year after rejecting its proposal to convert its GBTC into an ETF. 

Grayscale Urges SEC to Approve a Spot Bitcoin ETF

The asset manager has repeatedly called on the SEC to green-light a bitcoin spot ETF. Grayscale argues that it would be an efficient use of regulatory resources and ETF would serve the best interests of investors.  

The SEC has so far been hesitant to approve a spot BTC ETF over concerns relating to the potential risks associated with crypto investments. Grayscale asserts that the agency lacks substantial grounds to delay or deny its proposal to convert its GBTC into a spot ETF.

In somewhat positive news, the SEC indicated that it would not appeal the ruling in favour of Grayscale. In handing down its judgment, the court was very critical of the SEC’s refusal of Grayscale’s conversion proposal and said it was wrong to reject the application. 

Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.