Grayscale Investments has hired a former U.S. Solicitor General in preparation for a potential legal spat with the U.S. Securities and Exchange Commission (SEC), should the regulator reject its application for a spot Bitcoin (BTC) exchange-traded fund (ETF) on July 6.
The company has been waiting on a decision from the SEC to convert its flagship $19.8 billion Grayscale Bitcoin Trust (GBTC) into a spot-based ETF, since filing its application to the regulator on October 19, 2021.
The SEC has pushed back its decision on multiple occasions, once in December and again in February. A final decision on the application is expected on July 6.
Jake Chervinsky, head of policy at the crypto advocacy group Blockchain Association said adding such firepower to Grayscale’s legal team was a “strong move”, and that the SEC would have little chance of “surviving a legal challenge” if it decided to knock back approval now.
Strong move. @Grayscale means business.
The SEC’s deadline to approve or deny the application to convert GBTC to an ETF is July 6. No doubt, it should be approved. I don’t see how the SEC survives a legal challenge if not, especially one led by Don Verrilli.
Mark your calendar. https://t.co/ZbZ7oTXhHR
— Jake Chervinsky (@jchervinsky) June 7, 2022
In March, Grayscale CEO Michael Sonnenshein told Bloomberg that his firm would consider a lawsuit under the Administrative Procedure Act (APA) should the application for its Bitcoin Spot ETF be denied by the financial regulator.
He has been a vocal critic of the regulator, which approved crypto futures ETF products in October 2021 but is yet to do so for a spot ETF equivalent.
Donald B. Verrilli Jr., the new hire, is a former U.S. Solicitor General who served from 2011 to 2016 under Barack Obama’s administration. He is currently a partner in Californian law firm Munger, Tolles & Olson, and founded its Washington D.C. Office in 2016.
On Twitter, Grayscale explained that the lawyer has been involved in more than 50 cases before the U.S. Supreme Court, including several that dealt directly with Administrative Procedure Act (APA) violations.
He will serve as a senior legal strategist, working alongside its attorneys at Davis Polk & Wardwell LLP and its in-house counsel, including Craig Salm, who serves as chief legal officer.
Don’s legal acumen is unmatched. There’s no better advocate we could have to join our legal strategy team with @DavisPolkReg as we continue advocating to convert $GBTC to a spot
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