The SEC has denied the Ark-21 spot ETF listing, while the Grayscale CEO promised a fee reduction in a podcast.
The US Securities and Exchange Commission (SEC) has allowed Futures Exchange Traded Funds (ETF) to trade in the market since 2021. But, it has repeatedly rejected proposals for a Bitcoin spot ETF, mainly citing the risks from underlying assets, i.e., Bitcoin. On the other side, in Futures ETF, the underlying asset is the Futures contract instead of Bitcoin.
According to a recent SEC document, it has disapproved a proposal for Ark-21 spot Bitcoin ETF. At the same time, Grayscale is preparing for the oral arguments against the SEC.
SEC Disapproves Ark-21 Bitcoin Spot ETF Proposal for the Second Time
The SEC believes that the BZX exchange has not demonstrated that it is “designed to prevent fraudulent and manipulative acts and practices” and protect investors and the public interest.” The Cboe BZX is the exchange that filed with SEC to list Ark-21 Bitcoin spot ETF.
Ark 21 is a collaboration between Cathie Wood’s Ark Investment Management and investment firm 21Shares. Earlier, the SEC rejected its ETF listing in April 2022 as well.
Grayscale Arms up for the Oral Argument While CEO Commits to a fee Reduction
Last year, Grayscale sued SEC claiming that the regulator is applying an unfair double standard by allowing Bitcoin futures ETFs on the market exclusively. According to a CNBC report, the District of Columbia Court of Appeals has scheduled the oral arguments for the case on Mar. 7.
Grayscale charges 2% fees from the investors; hence there has been frustration amongst the community for the high fees and inability to redeem the shares for Bitcoin. The CEO of Grayscale, Michael Sonnenshein, addressed the concerns on an Unchained Podcast episode released today.
The CEO feels strongly about the SEC case and promises to lower the fees when GBTC gets converted into an ETF.
He says, “We are committed to lowering the fee on GBTC when it converts to an ETF. But all the fees that are being generated on GBTC that is all the capital that we as an organization are putting into our lawsuit against the SEC, bringing the best legal minds possible to the case and really just continuing to advocate for our investors. So we feel very strongly about the case the full resources of the firm are behind it.”
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