In an unequivocal appeal to the Securities and Exchange Commission (SEC), GreyScale filed a response brief rejecting its application to convert its $12 billion GrayScale bitcoin private equity fund (GBTC) into spot bitcoin (BTC) exchange traded fund (ETF). The briefing, filed with the Court of Circuit in Washington, D.C., covered several points made in the SEC's response brief filed last December and strictly enforced its arguments.

An important basis for SEC's determination is that GrayScale's recommendations do not adequately prevent fraud and manipulation. The agency has made similar findings in several previous applications for spot-based BTC ETF.

The GreyScale court refuted the denial, saying that SEC had acted rashly in the face of spot trading exchange-traded products and commodity futures products. "there is a 99.9% correlation between prices in the bitcoin futures market and the spot bitcoin market," GrayScale said in a briefing. It also claims that SEC abused its power:

"the European Commission does not allow investors to determine whether an investment in a project is of use value-but it only does so, at the expense of the investors and potential investors it undertakes to protect."

Crawford Salem, chief legal officer of GreyScale, said on Twitter: "the case is moving fast. Although the timing will not be clear, the verbal debate is likely to be faster in the second quarter [2023]. GreyScale submitted its application to SEC in October 2021, and the agency rejected the application on June 29th.

Fir Tree Capital Management filed suit against GrayScale on December 6th, while demanding that the appeal established by SEC be waived. "this response could take decades of prosecution, millions of dollars in legal costs, countless management time damage, and sincerity to regulators," the civil indictment said. "

GreyScale is owned by the Digital currency Group, which is facing accounting tightening at this stage.