Oral arguments in Grayscale’s lawsuit against the SEC to be heard in court in March

The early schedule has been described as good news by Grayscale Investment, which had anticipated that it wouldn’t be able to express its arguments until the second quarter of the year. 

Court set to hear oral arguments in Grayscale’s lawsuit

Oral arguments in Grayscale Investment’s suit against the Securities and Exchange Commission (SEC) about the latter’s decision to reject Grayscale’s BTC spot exchange-traded fund (ETF) are scheduled to be heard by a United States appeals court soon.

Oral arguments are speeches made by lawyers outlining why their clients ought to win. Each side in the case is allotted an equal amount of time to address the judge directly and respond to his or her questions. 

Grayscale Investments and the Securities and Exchange Commission (SEC) will argue their cases before the District of Columbia Court of Appeals on March 7 at 9:30 a.m. local time, according to a court petition submitted on January 23.

Craig Salm, the Chief Legal Officer of Grayscale Investment, who took to Twitter on January 24 to share a picture of the court order: 

He added that they were “previously anticipating oral arguments to be as soon as Q2 this year.” “So this is welcome news.”

Argument panel to be made public 30 days before the D-day

“As always, $GBTC shareholders and the $BTC community can continue to track the litigation here. The next event to look out for will be selection of the 3-judge panel from the DC Circuit Court of Appeals (about a month before oral arguments).”

According to the petition, the members who make up the argument panel for the Grayscale case will be made public on February 6, which shall be 30 days before the oral argument’s scheduled date, and the length of the argument will be determined in a subsequent order.

The Grayscale and SEC lawsuit began in June 2022 after the regulatory body denied its request to have its $12 billion Grayscale Bitcoin Trust (GBTC) converted into a spot-based ETF.

Grayscale claimed in a reply brief submitted earlier this month to the D.C. Court of Appeals that the SEC had acted unreasonably when it treated spot-traded ETFs differently from futures-traded products and that the SEC had overstepped its bounds by denying the firm’s request for a Bitcoin ETF.

New legislations not needed for SEC to approve Spot Bitcoin ETF

In an appearance on CNBC’s Squawk Box on January 24, Grayscale CEO Michael Sonnenshein emphasized a similar idea to Craig’s. In regards to their legal action against the SEC, Sonnenshein stated that they were definitely expecting a ruling from the courts in the second or third quarter of this year. He expressed that:

“The frustrating thing for investors and certainly the Grayscale team is that we’re actually a business that was born in the U.S., made use of existing U.S. regulatory frameworks to bring crypto to investors in a safe and compliant way.”

He noted that “cryptocurrencies are here to stay” and that the approval of the Spot Bitcoin ETF doesn’t require the SEC to make or pass new legislation because it fits into existing regulatory frameworks.

Sonnenshein stated that folks share his belief and that the recent investor harm that’s happened in the cryptocurrency sector would have been prevented if the SEC had approved their request. 

“It’s important to remind the role that regulators like the SEC play when it comes to investors. They’re not here to tell investors what to or what not to invest in. They’re here to ensure all the proper disclosures are made… so investors are made aware of all the risks associated with any potential investment they are making… That’s really the role of the SEC. “