Grayscale objects to discriminatory treatment, arguing that the SEC's approval of a "Bitcoin leveraged ETF" represents double standards.
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Grayscale objects to discriminatory treatment, arguing that the SEC's approval of a "Bitcoin leveraged ETF" represents double standards.
Grayscale expressed dissatisfaction with the SEC's approval of leveraged Bitcoin futures ETFs, arguing that the SEC is treating spot products and futures products unequally.
Navigating Web3 tides with focused insightsFollowing major Wall Street firms' consecutive applications for spot Bitcoin ETFs last month, the U.S. welcomed its first leveraged Bitcoin futures ETF at the end of the month. Proposed by Volatility Shares, this leveraged Bitcoin ETF—BITX—was not rejected by the U.S. Securities and Exchange Commission (SEC), and officially launched on June 27.
Grayscale Protests Unequal Treatment
Grayscale Investments, the asset management firm whose repeated attempts to convert its Bitcoin Trust (GBTC) into a spot ETF have been ignored or rejected by the SEC, expressed strong dissatisfaction over the regulator's approval of a leveraged Bitcoin ETF.
In a letter submitted Monday to the U.S. Court of Appeals for the District of Columbia Circuit, Grayscale lawyer Donald Verrilli criticized the SEC’s decision as illogical, stating that leveraged Bitcoin exchange-traded funds are clearly “riskier investment products.”
The SEC's allowance of leveraged Bitcoin futures ETPs indicates ongoing bias in its handling of spot Bitcoin ETP applications, applying unequal standards between spot and futures-based products.
The legal battle between the SEC and Grayscale over the conversion of GBTC into a spot Bitcoin ETF, which began last year, continues intensively. Verrilli previously presented a core argument in court: Grayscale has already signed surveillance agreements required for futures ETFs, demonstrating that the SEC can effectively oversee such ETFs; moreover, approving a spot Bitcoin ETF from Grayscale would serve to “better protect investors.”
Grayscale clarified its position on Twitter, emphasizing it does not oppose the existence of leveraged products. Rather, it aims to highlight the SEC’s inconsistency—approving higher-risk leveraged futures products while rejecting spot Bitcoin ETFs without sufficient justification.
Now Backed by Major Institutions
With giants like BlackRock and Fidelity filing applications with the SEC in mid-June to launch spot Bitcoin ETFs, GBTC’s daily trading volume surged to nearly $80 million just five days after BlackRock’s application—an increase of about 400%.
According to Coinglass data, Grayscale’s total holdings currently amount to $19 billion. The GBTC discount has narrowed to 27.49%, recovering approximately 21.13 percentage points from its peak discount of 48.62% in December 2022.
GBTC first began trading at a discount in February 2021, and the gap widened throughout the bear market of 2022. Only in 2023 has the discount begun to stabilize. Many prominent market investors remain optimistic about GBTC’s future, believing Grayscale is likely to prevail in its lawsuit against the SEC. Cathie Wood, known as the "ARK queen," has repeatedly praised GBTC’s potential gains and anticipates a return to premium pricing. Her firm, ARK Investment, is also GBTC’s largest holder.
GBTC Discount Rate
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