Crypto asset manager Grayscale Investments is gearing up for a prolonged legal fight with the U.S. Securities and Exchange Commission to create a spot bitcoin exchange-traded fund, the company’s chief executive officer said, Reuters reported. As the company awaits a court ruling on a June lawsuit against the SEC, CEO Michael Sonnenshein said that he was prepared to appeal if the court backed the SEC's decision to reject the bitcoin ETF proposal. "The only option the SEC left us with was to turn around and say, you know what, this just isn't right,” Sonnenshein said. Suing the regulator was one of the most important decisions he had made as CEO, and was "one that I did not, and we as a team, did not take lightly," he said, adding that he is confident the court will rule in the firm's favor. The SEC rejected Grayscale’s application to convert its flagship Grayscale Bitcoin Trust (GBTC) into an ETF in June, arguing that the proposal did not meet standards designed to prevent fraudulent practices and protect investors. Grayscale sued the SEC almost immediately after its proposal was denied, claiming that the regulator was acting arbitrarily in rejecting applications for spot bitcoin ETFs when it had previously approved bitcoin futures ETFs. The case is being heard in front of the District of Columbia Court of Appeals. If either party were to appeal the ruling, the case would either go to the U.S. Supreme Court or an en banc_ panel review. Oral arguments in the case are scheduled to occur March 7 and Grayscale expects a final ruling on the case in the fall, said Sonnenshein.
