Grayscale Hires Former Solicitor General To Help Force Bitcoin ETF Approval

Grayscale Investments has hired a former US Solicitor General in view of a possible legal dispute with the US Securities and Exchange Commission (SEC), if the regulator rejects its application for Bitcoin (BTC) exchange-traded fund (ETF) on July 6. .

The company has been awaiting a decision from the SEC to convert its $19.8 billion flagship Grayscale Bitcoin Trust (GBTC) into a spot ETF, since filing its application with the regulator on October 19, 2021.

The SEC has repeatedly pushed back its decision, once in December and again in February. A final decision on the application is expected on July 6.

Jake Chervinsky, chief policy officer at crypto advocacy group Blockchain Association, said adding such firepower to Grayscale’s legal team was a “strong move,” and the SEC would have little chance of “surviving a legal challenge” if it decides to hold back approval. now.

In March, Grayscale CEO Michael Sonnenshein told Bloomberg that his firm would consider legal action under the Administrative Procedure Act (APA) if the application for its Bitcoin Spot ETF was denied by the financial regulator.

He was highly critical of the regulator, which approved crypto futures ETF products in October 2021, but has yet to do so for a cash ETF equivalent.

Donald B. Verrilli Jr., the new employee, is a former US solicitor general who served from 2011 to 2016 under the administration of Barack Obama. He is currently a partner at California law firm Munger, Tolles & Olson, and founded its Washington DC office in 2016.

On Twitter, Grayscale explained that the attorney has been involved in more than 50 cases before the U.S. Supreme Court, several of which directly involved violations of the Administrative Procedure Act (APA).

He will act as lead legal strategist, working alongside his attorneys at Davis Polk & Wardwell LLP and his in-house counsel, including Craig Salm, who serves as chief legal officer.

Grayscale described Verrilli as one of the nation’s most experienced attorneys with “a deep understanding of legal theory, administrative procedure, and the practical issues of working with the judiciary.”

“We are delighted to have him join our team as we work towards a positive resolution for investors and the general public.”

Meanwhile, Citadel Securities, a market maker that could provide liquidity for crypto ETFs such as the one offered by Grayscale on Tuesday, said it is open to supporting crypto ETFs, but will not do so without regulatory approval.

“We’ll be ready if and when these products are approved, but we’re taking a measured approach,” Kelly Brennan, head of Citadel ETF, said in an interview with Bloomberg.

Market makers are key liquidity providers in the ETF ecosystem, as they ensure continuous and efficient ETF trading.

Related: Why the World Needs a Spot Bitcoin ETF in the US: 21Shares CEO Explains

Elsewhere in the world, crypto ETFs are growing in popularity, with total assets invested in crypto ETFs and exchange-traded products (ETPs) reaching $16.28 billion globally by the end of Q1 2022, according to data from ETF research firm ETFGI.

In February 2021, Canada launched its first-ever Bitcoin ETF, the Purpose Bitcoin ETF, becoming one of the first countries in the world to adopt a spot Bitcoin ETF.

On May 12, Australia launched its first crypto spot ETFs, including a Bitcoin ETF from Cosmos Asset Management, as well as BTC and Ether (ETH) spot ETFs from 21Shares. Two more crypto ETFs were launched on Monday, June 6.

In May, Grayscale began trading its first European ETF, called Grayscale Future of Finance UCITS ETF, which is listed on the London Stock Exchange, Borsa Italiana as well as Deutsche Börse’s Xetra electronic trading platform.

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