The U.S. Securities and Exchange Commission (SEC) has expressed concerns about how Grayscale will head off share manipulation, fraud and other possible issues in its proposal to convert its Grayscale Bitcoin Trust (GBTC) into a bitcoin spot exchange-traded fund (ETF), according to a notice Friday.
- The regulator also flagged its concerns about the liquidity and transparency of bitcoin markets, as well as the “suitability” of bitcoin as the underlying asset for the fund. Grayscale is a unit of Digital Currency Group, which is also the parent of CoinDesk.
- The SEC has asked the public to comment on these issues, and given them 21 days to do so, with an additional 14 days for responses to those comments.
- Earlier this week, the SEC requested investment manager Bitwise to respond to similar concerns about its own spot bitcoin ETF proposal.
CORRECTION (Feb. 4, 2022, 22:00 UTC): Corrects bullet point on comment and rebuttal periods for the public.
CORRECTION (Feb. 4, 2022, 22:12 UTC): Corrects bullet point to state that the SEC's concerns are about the liquidity and transparency of Bitcoin markets.
UPDATE (Feb. 4, 2022, 22:32 UTC): Updated with additional detail throughout.
The leader in news and information on cryptocurrency, digital assets and the future of money, CoinDesk is an award-winning media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. In November 2023, CoinDesk was acquired by Bullish, a cryptocurrency exchange, which in turn is owned by Block.one, a firm with interests in a variety of blockchain and digital asset businesses and significant holdings of digital assets including bitcoin and EOS. CoinDesk operates as an independent subsidiary, and an editorial committee, chaired by a former editor-in-chief of The Wall Street Journal, is being formed to support journalistic integrity.