Bitcoin and altcoin asset manager Grayscale recently made a statement. He announced that the US Securities and Exchange Commission (SEC) has asked Grayscale to withdraw its application for the Filecoin (FIL) Trust product. Here are the details…
SEC wants Grayscale to withdraw altcoin application
Grayscale had voluntarily submitted a Form 10 application to make Filecoin Trust a company that was required to submit quarterly and annual reports. The SEC has now asked Grayscale to withdraw this application. Grayscale said in a press release that it had received a comment letter from the SEC stating that it “meets the security definition” of the FIL. “The SEC has requested that Grayscale immediately withdraw its registration statement,” Grayscale said. He also used the following expressions:
Grayscale does not believe that the FIL is a security under federal securities laws. It aims to respond promptly by explaining to SEC personnel the legal basis for Grayscale’s position. Grayscale cannot predict whether SEC personnel will be convinced that Grayscale’s position is correct, and if not convinced, Grayscale will need to seek facilities to allow the trust to register under the Investment Company Act of 1940, or alternatively seek dissolution of the Trust.
Grayscale said in a public filing in April that the SEC reached out to them at the time “regarding Grayscale’s analysis of the securities law of the FIL.” “We acknowledge that the FIL may be a security now based on facts that exist today, or may be found in the future by the SEC or a federal court as a security under federal securities laws, regardless of Grayscale’s previous conclusion,” Grayscale said.
FIL price depreciated
The price of the FIL dropped about 3 percent on the SEC news, then rebounded slightly. It is currently trading at $4.51. This development reflects the increasing scrutiny of SEC employees on crypto tokens and their status under US securities law. SEC Chairman Gary Gensler has repeatedly said that most cryptocurrencies are securities. cryptocoin.com As we’ve reported, this is a stance that differs fundamentally with the crypto industry, including Grayscale.
Issuers of securities must register with the SEC and make regular disclosures. Since 2017, the SEC has been putting pressure on projects that raise funds through cryptocurrencies, particularly initial coin offerings (ICOs). It forces many of these projects to pay back investors or close them. Filecoin raised $200 million through an ICO. Grayscale previously made statements similar to the April Filecoin Trust announcement regarding trust products for Stellar’s XLM, Zcash’s ZEC, and Horizen’s ZEN.
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