The US Securities and Exchange Commission (SEC) rejected Grayscale’s request to convert its Grayscale Bitcoin Trust (GBTC) vehicle into a spot Bitcoin, and Grayscale has now chosen to sue the SEC in court. “We have filed a lawsuit against the SEC,” declared SEC Chairman Michael Sonnenshein.
There has been a new development regarding this issue. We are going to explore.
Grayscale v SEC Adjourned Trial
A court order filed on January 23 states that the court will hear arguments from both sides on March 7. Grayscale had anticipated that oral arguments would begin in the second quarter. The action may have been prompted by Genesis Capital, a sister company to Grayscale and a cryptocurrency lender, which filed for Chapter 11 bankruptcy last week. Due to the bankruptcy of FTX, Genesis stopped withdrawals, repayments and the creation of new loans.
Since the bankruptcy of cryptocurrency exchange FTX, Genesis has experienced significant withdrawals and significant liquidity problems. Genesis also has $175 million of its own locked up in FTX due to its downfall and insolvency. Genesis Global has suggested a roadmap for getting through its Chapter 11 bankruptcy, which provides a framework for a package deal and trust to distribute assets to your creditors.
Why should Genesis’ bankruptcy be blamed?
After the Genesis bankruptcy, investor concerns about GBTC’s ever-increasing discount rates have grown. The GBTC now has $14.5 billion in assets under management and a negative premium rate of 41.5%.
Management and sponsorship of the Grayscale Bitcoin Trust has been proposed to be taken over by Valkyrie Investments and Osprey Funds (GBTC). According to the companies, shareholders will have a better option to reduce management fees and a bailout plan.
The community has reacted to this and called it great. The fact that it is moving forward means that it is an urgent matter and cannot wait.
The SEC has come under fire from many people for its numerous lawsuits recently. Some have also claimed that it is concentrating on trivial matters instead of what is truly crucial.
This post Grayscale vs. SEC Heats Up: Court Hearing Moved Up to March 7!
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