SEC rejects Grayscale's registration application, considers Filecoin (FIL) as a security, Grayscale: may terminate Filecoin Trust

Grayscale submitted a Form 10 registration application to the SEC in April this year, aiming to have its trust fund product, Filecoin Trust, become a Reporting Entity under the U.S. Securities and Exchange Commission, requiring the submission of regular financial reports. However, this was rejected by the SEC.

SEC: FIL Meets Securities Definition under Investment Company Act

Grayscale announced on May 17 that its trust fund, Filecoin Trust FIL, submitted a registration statement on Form 10 under the 1934 Securities Exchange Act on April 14 this year.

However, on May 16, the SEC responded to Grayscale, stating that the underlying asset Filecoin FIL of Filecoin Trust meets the federal securities definition under the federal securities laws, and the fund itself appears to also meet the definition of an investment company as defined in the Investment Company Act of 1940, and requested Grayscale to immediately withdraw the registration statement.

Grayscale: Will Discuss with SEC

Grayscale emphasized that FIL does not fall under the definition of securities as defined by federal securities laws and will explain the legal basis of Grayscale and the trust fund to the SEC.

However, Grayscale also pointed out that they cannot predict whether the SEC can be convinced. If negotiations fail, Grayscale may take different measures:

• Attempt to register Filecoin Trust under the Investment Company Act of 1940

• Terminate Filecoin Trust

Filecoin FIL's token price has not been significantly affected, with a 3.8% increase in the past 24 hours as of the deadline, but has seen a -15% decrease since May.