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Grayscale launches SOL trust fund, accuses SEC of approving commodities without standards, violating administrative procedures act

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Grayscale launches SOL trust fund, accuses SEC of approving commodities without standards, violating administrative procedures act

The cryptocurrency asset management company Grayscale announced on the 30th that it has added Solana (SOL) fund product, making it the 14th single-asset investment product under its umbrella. In addition, Grayscale recently wrote a letter to the U.S. Securities and Exchange Commission (SEC), accusing the SEC of having no basis for its delayed approval of a Bitcoin spot ETF.

Grayscale Solana Trust Product

Grayscale's latest investment product is the Solana Trust Fund, which is now open for eligible individuals and institutional investors to subscribe to. Grayscale currently offers a total of 16 investment products, with 14 of them focusing on single-asset cryptocurrencies, including BTC, ETH, MANA, FIL, and more.

"We have seen an increasing number of investors choosing cryptocurrency assets beyond BTC and ETH to diversify their investments. The Grayscale series of products will continue to expand this exciting asset class and remain committed to providing investors with opportunities to enter the digital economy," Grayscale stated.

Grayscale's Allegations Against SEC

Since the SEC first approved Bitcoin futures ETFs in early October, a total of three Bitcoin futures ETFs have been approved by VanEck, Valkyrie, and ProShares. However, when it comes to Bitcoin spot ETFs, the SEC has maintained a tough stance and has yet to approve any, frequently delaying review results.

Regarding the above situation, Grayscale sent a letter to SEC Secretary Vanessa Countryman on Monday, the 29th, claiming that the SEC's refusal to approve Bitcoin spot ETFs is unreasonable. Grayscale stated that the SEC's position lacks consistency, questioning why investing in derivative products is acceptable for investors while spot products are not?

Differential Treatment of Bitcoin Futures and Spot Products

Using the previously approved Bitcoin futures ETFs as an example, SEC Chairman Gary Gensler has stated that futures products from the CME Chicago Mercantile Exchange are subject to additional oversight under the 1940 Investment Company Act, providing more investor protection. Products proposed under the 1934 Securities Act, focusing more on information disclosure, are more difficult to approve.

However, Grayscale countered in their letter that despite the commission citing investor protection provided by the 1940 Act as the reason for differential treatment, this Act does not address the concerns raised by the SEC in rejecting Bitcoin spot ETFs, such as the "potential market manipulation and fraud in the Bitcoin market."

Furthermore, Grayscale questioned why the SEC believes that CME's pricing mechanism is sufficient to filter out market manipulation, while spot market products do not. Grayscale believes that the SEC's failure to treat the two Bitcoin ETF products equally may have violated the Administrative Procedure Act.

As of now, the SEC has not responded to Grayscale's allegations, and the review of the Bitcoin spot ETF application submitted by Grayscale in October will take place just before Christmas. It is hoped that by that time, the SEC will provide a response to the issues raised and no longer reject approvals for similar reasons.