Grayscale Investments, a cryptocurrency asset manager, achieved a significant victory against the United States Securities and Exchange Commission (SEC) in its pursuit of converting the Grayscale Bitcoin Trust (GBTC) into a publicly listed Bitcoin exchange-traded fund (ETF). U.S. Court of Appeals Circuit Judge Neomi Rao granted Grayscale’s request for review and vacated the SEC’s order denying the GBTC listing application. Judge Rao had previously criticized the SEC for failing to provide an adequate explanation for its stance.
While the crypto community initially celebrated this victory, there is a recognition of the limitations of the court’s decision. Delphi Labs’ General Counsel, Gabriel Shapiro, remarked that the SEC tends to persist even after losing in court, and Austin Campbell, Managing Partner at Zero Knowledge Consulting, highlighted the financial challenges companies face when contesting regulatory actions.
In parallel, the SEC has postponed its decisions on six applications for spot Bitcoin ETFs. The regulator extended its review period for applications submitted by WisdomTree, VanEck, Invesco Galaxy, Bitwise, Valkyrie, and Fidelity’s Wise Origin Bitcoin Trust. The SEC now has an additional 45 days, extending until October, to approve, deny, or further delay a decision on these proposed rule changes that would permit the listing of these investment vehicles.
Additionally, the United Kingdom has implemented the Travel Rule for cryptocurrencies, impacting crypto asset businesses. These businesses may now withhold certain crypto transfers to comply with the Travel Rule. When receiving inbound payments from jurisdictions that have not adopted the Travel Rule, virtual asset service providers must conduct a “risk-based assessment” before making the crypto assets available to the beneficiary. This rule also applies to Britons making payments outside the UK.”