A panel of judges voiced their thoughts during the appeals court hearing on Grayscale’s ongoing bid to convert the Grayscale Bitcoin Trust (GBTC) into an exchange-traded fund (ETF).
The panel of appellate court judges questioned the SEC’s rationale for making a distinction between Bitcoin spot market prices and futures market prices.
Judges Question SEC’s Arguments Against Grayscale’s ETF
A panel of judges was skeptical of the US Securities and Exchange Commission’s (SEC) arguments during the appeals court hearing on Grayscale’s ongoing bid to convert the Grayscale Bitcoin Trust (GBTC) into an exchange-traded fund (ETF).
Grayscale went to court on Tuesday to prove that the SEC had no valid reason to reject its ETF application. The company told the panel that it “wanted to be regulated” by the SEC through Grayscale’s conversion of GBTC into an ETF.
Chief Justice Sri Srinivasan and Judges Neomi Rao and Harry Edwards of the District Court of Appeals for the District of Columbia in Washington, DC asked SEC Senior Advisor Emily Parise a series of questions about the agency’s claim that Bitcoin futures prices underlying futures ETFs are more resilient.
Judge Rao asked a series of questions about futures prices as opposed to spot prices:
“It seems to me that what the Commission really needs to explain is how it understands the relationship between Bitcoin futures and the Bitcoin spot price. As I understand it, one is essentially a derivative. They act together 99.9 percent of the time. So where is the gap in the Commission’s view?”
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