SEC Expressed Concerns About Grayscale’s Spot Bitcoin ETF Proposal

The SEC expressed concerns about a Grayscale spot Bitcoin ETF because it fears possible share manipulation and liquidity of Bitcoin markets so let’s read further in today’s latest cryptocurrency news.

The US SEC expressed concerns about how the Grayscale spot bitcoin ETF could head off share manipulation and fraud via its proposal to convert the bitcoin Trust into a Bitcoin spot exchange-traded fund. The regulator flagged concerns about liquidity and transparency of Bitcoin markets as well as the sustainability of Bitcoin as the main asset for the fund. The SEC also asked the public to comment on the issues and gave them 21 days to do with another 14 days for responses to the comments.

Earlier this week, the SEC requested Bitwise investment manager to respond to similar concerns about its own spot BTC ETF proposal. Grayscale filed an application with the SEC to convert the Grayscale Bitcoin Trust into a BTC spot ETF and the SEC pushed off the review of Grayscale’s application by 45 days. Over the past few months, the agency rejected spot bitcoin ETF applications from Krypton, Fidelity, SkyBridge, and Wisdom Tree. It is also weighing a number of other applications from investment firms.

The world’s biggest digital asset manager Grayscale Investments announced the launch of the first ETF dubbed Grayscale Future of Finance ETF and will be the first equity ETF to track the performance of the Grayscale Futures of Finance index. Bloomberg and Grayscale launch their first equity ETF and the statement informed that the new product’s ticket will be dubbed GFOF. It will aim to build on the thesis that the digital economy will improve global commerce and will drive market efficiencies to provide access to new pools of capital while reducing the need for costly intermediaries.

Bloomberg’s Global Head of Multi-Asset Indices Dave Gedeon said the new product is primed to become the key equity benchmark for the digital economy. While GFOF will launch today, grayscale made a few attempts to release a spot BTC ETF in the states but the company remained committed to converting its biggest product into an exchange-traded fund whcih will track the performance of the main cryptocurrency.

As recently reported, Grayscale’s GBTC premium continued falling and reached a new all-time low.
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According to the data from Coinglass, the trust’s negative premium reached an all-time low as BTC has a hard time around the $35,000 price point. The GBTC has been trading on a decline since February last year with the premium now sitting at 30%.