The largest Bitcoin fund, Grayscale, is fighting the Securities and Exchange Commission in court with the backing of Coinbase, the largest cryptocurrency exchange in the United States (SEC).
Grayscale Protests Barring Of Its Bitcoin ETF
Grayscale has made the decision to file a lawsuit after the federal regulator denied its request for a Bitcoin ETF and all others. The SEC, the fund alleges is failing to apply consistent treatment to similar investment vehicles by allowing a number of Bitcoin futures ETFs but preventing the establishment of spot market ETFs.
Coinbase Backs Grayscale Cause With Own Lawsuit
Coinbase argued the same position in an amicus curiae brief on Tuesday that was filed with the U.S. Court of Appeals for the District of Columbia. Investors may utilize exchange-traded funds to get exposure to a certain asset class without owning that asset directly (ETFs).
Investors may participate in the cryptocurrency market if Bitcoin were incorporated in an exchange-traded fund (ETF), for example, without needing to buy Bitcoin directly from a cryptocurrency exchange and store it in a wallet.
Investors Will Be Able to Bet On the BTC Price With Futures
Futures and spot market ETFs both aim for the same goal, but they employ different approaches to get there. In contrast to derivative contracts, which allow investors to bet on the price of Bitcoin in the future through futures ETFs, spot market ETFs would back their shares with Bitcoin.
The futures market is under CFTC regulation as well. In the past, Gary Gensler, the current head of the Securities and Exchange Commission (SEC), has hinted that this would make these markets safer for regular investors. The actual buying and selling of Bitcoins on the “spot market” is not regulated in any way.
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