SEC Initiated Talks On GBTC Application, BlackRock Fidelity Registration Making Progress: Grayscale Executive

Illustration shows representations of cryptocurrency Bitcoin — Reuters

KEY POINTS

A court ordered the SEC to reconsider Grayscale's spot Bitcoin ETF application
The SEC did not file a motion against the Court of Appeals for the District of Columbia Circuit's decision
Grayscale has been reportedly communicating with the SEC's trading and markets division, as well as its corporation finance department

The Securities and Exchange Commission (SEC) has reportedly started talks with digital currency asset management company Grayscale Investment regarding its spot Bitcoin exchange-traded fund (ETF) application.

The Court of Appeals for the District of Columbia Circuit last month ordered the SEC to reconsider Grayscale Investment's application to register a Bitcoin ETF with the New York Stock Exchange Arca after the regulator failed to file a motion.

Now, the SEC has started its discussions with Grayscale on the details of the company's application to convert its trust product GBTC into a spot BTC ETF, Coindesk reported, citing a person familiar with the matter.

Grayscale has been communicating with the SEC's trading and markets division, as well as its corporation finance department, following the business' legal victory, the report said, underlining that both divisions play a crucial role in molding and approving the ETF filing.

The crypto asset manager remains mum on the issue, with its chief legal officer, Craig Salm, saying the firm is currently focused on constructively re-engaging with trading and markets."

"There are still things that have to be worked through," he added.

Salm noted that financial giants like BlackRock and Fidelity are making progress with their spot Bitcoin ETF applications. "Overall, it's been good engagement, and it's a matter of when, not a matter of if anymore," he said.

Industry watchers earlier speculated that the SEC might revisit Grayscale's Bitcoin ETF application as the commission was preparing for a closed-door meeting.

Finance lawyer Scott Johnson at the time said the meeting would focus on resolving litigation claims and administrative proceedings.

"November 2 - I believe this is the first closed meeting of the Commissioners since Grayscale appeal deadline expired and the mandate was delivered. The agenda includes resolving litigation claims and admin proceedings. There were leaks out of the closed meeting ahead of BITO launch," Johnson, who is also a general partner at Van Buren Capital, shared.