Grayscale May Sue SEC Over GBTC Options

Grayscale Investments has sent a letter to the Securities and Exchange Commission (SEC) to make a case for approving options on Grayscale's Bitcoin Trust (GBTC).

Nate Geraci, President of ETF Store, speculated about the possibility of a looming lawsuit since Grayscale's letter to the SEC emphasized what they deemed as "unfair discrimination" against shareholders. 

Grayscale's push for equal treatment

Grayscale has been lobbying the SEC to extend the options approval to its spot bitcoin ETF, arguing for a level playing field. 

Michael Sonnenshein, CEO of Grayscale, articulated in the letter that denying GBTC the ability to offer options would disadvantage its investors and hinder the product's appeal to potential ones. 

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Notably, the SEC has previously approved options trading for ETFs tied to bitcoin futures, setting a precedent that Grayscale believes should be applied to their product as well. 

The crypto asset manager is advocating for GBTC's options to facilitate better price discovery, market navigation, and hedging strategies for investors.

The path forward 

Sonnenshein has been outspoken regarding the necessity for establishing a substantial market for options on spot Bitcoin ETFs.

He points out that options for bitcoin futures ETFs became available one day after trading commenced, but spot Bitcoin ETFs are lagging behind due to the intricacies involved in regulatory approvals.

The disparity in treatment between futures and spot bitcoin ETFs has been a point of contention, with Sonnenshein emphasizing the benefits of options for all investors.