Another Massive L for the SEC
And a Massive Win for Bitcoin Investors
We live in an insanely unjust financial and monetary system, so when the authoritarians like SEC Chair Gary Gensler do the bidding of those who want to maintain the status quo and lose, we celebrate.
Here’s a teaser:
Now, I’ll explain…
On June 29, 2022, the SEC rejected Grayscale’s application to turn its Bitcoin Trust, GBTC, into a spot ETF.
I wrote a piece on this for Nasdaq on behalf of Finder, if you’d like more details: “SEC Rejects Application to Convert Grayscale Bitcoin Trust (GBTC) Into Spot ETF”
Here’s an excerpt from it:
Why did the SEC reject the application?
The SEC claimed that Grayscale’s ETF proposal failed to prove that it would adhere to “the rules that a national securities exchange be ‘designed to prevent fraudulent and manipulative acts and practices’ and ‘to protect investors and the public interest.’”
What exactly this statement means is unclear, and the SEC declined to comment further.
Many investors are confused, as the SEC approved the Proshares Bitcoin Strategy ETF (BITO) in October 2021 to provide investors with access to Bitcoin futures contracts as a means to long Bitcoin. In June 2022, the agency also approved the Proshares Short Bitcoin Strategy ETF (BITI), which provides investors with a means to short Bitcoin.
It seems odd that the SEC feels that approving derivative products — or paper contracts — on Bitcoin was more important than approving a spot ETF for the asset.
Today, a judge ruled that this move was “arbitrary and capricious,” something that was clear to anyone that knew anything about this situation.
A Grayscale spokesperson shared the following:
“[the decision] is a monumental step forward for American investors, the Bitcoin ecosystem, and all those who have been advocating for Bitcoin exposure through the added protections of the ETF wrapper."
I couldn’t agree more.
As I’ve said many times in this newsletter, the United States will lose its war on Bitcoin.
And today, thanks to the courts, it has lost yet another battle in that war.
Let it up,
Frank
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