The U.S. Securities and Exchange Commission has recorded another setback in its aggressive clampdown on the crypto industry. On Tuesday, the country’s Court of Appeals approved the petition by popular crypto asset manager, Grayscale to force the regulator into reviewing its spot Bitcoin-ETF filing. According to the court document, Judge Neomi Rao ruled that the SEC must review its decision to reject the firm’s filing.
Recall that Grayscale had sued the regulator in June 2022. Then, the SEC rejected Grayscale’s filing to convert its Bitcoin Trust (GBTC) into ETF. However, Judge Rao, in a ruling, maintained that the agency could not prove that Grayscale was in the wrong with its filing. Therefore, it was ordered that its disapproval of the filing must be vacated. With this ruling, the SEC is left with no option but to review the application again.
As of the time of filing this report, the regulator has yet to react to the ruling. However, the CEO of Grayscale, Michael Sonnenshein, in a Twitter post, commended the ruling. Sonnenshein added that the legal team of the firm will study the ruling and take next steps with the SEC.
Bitcoin soars after Grayscale victory
Meanwhile, it is worth establishing that a few minutes after the news of the Grayscale ruling dominated the crypto town, Bitcoin saw a huge spike in its value. Don’t forget that the largest crypto by market cap started the day below $26,200. However, as of the time of filing this report, it has skyrocketed to $27,200 according to TradingView data.
Grayscale sees this ruling as a major milestone for the crypto industry. Since a few years ago, the SEC has been aggressive in its enforcement actions against the crypto firm. Its chair, Gary Gensler sees every crypto asset apart from Bitcoin as securities and thus has continued to be on the neck of firms offering them.
This explains why it sued the likes of Ripple, Binance, Coinbase, and several others. However, it suffered a brutal setback last month in its battle against Ripple. Then, the court ruled that XRP is not a security, thereby putting an end to the agelong stalemate. According to the July 13 judgment, XRP lacks the criteria to be categorized as a security. Now, the latest ruling by the Court on Grayscale application is another big setback for the SEC.
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