Osprey sues Grayscale for misrepresenting ETF approval possibility

Osprey claimed that his sole competitor in the BTC OTC trust asset market gained 99.5% market share by misrepresenting the possibility of converting his trust into an ETF.

Digital asset manager Osprey Funds filed a lawsuit against Grayscale Investments on January 30 for allegedly violating the Unfair Trading Practices Act. The lawsuit concerns Grayscale’s advertising activities and the promotion of Bitcoin.

Osprey claimed in the lawsuit that Grayscale is the only competitor in the Bitcoin trust asset management market, and Grayscale has maintained its leading position through deception:

“Despite being charged more than four times the asset management fee Osprey charges for its services, Grayscale was able to retain 99.5% of its market share in a market with only two companies, thanks only to false and misleading advertising and publicity.”

Specifically, Osprey claimed that Grayscale convinced investors by claiming that the $12 billion GBTC was their way to access a spot-based Bitcoin ETF. According to the lawsuit, Grayscale presented the transformation as “an inevitable outcome even though it knew that access would never happen.”

Osprey sues Grayscale for misrepresenting ETF approval possibility

Osprey reports that Grayscale did this on purpose and continues to describe it as “likely.” Because the SEC has always dismissed the possibility of such a transformation for the Bitcoin commodity fund at every opportunity. Osprey suggested that Grayscale executives mislead people in emails, press releases, Twitter, and on television.

The SEC rejected Grayscale’s application to convert GBTC to ETF on June 29, 2022. Grayscale filed a petition for review in the District Court of Appeals for the District of Columbia that same day. The court is expected to hear the oral defenses on March 7.

Grayscale is part of the Digital Currency Group, a subsidiary of Genesis Global Capital, which declared bankruptcy on January 19th.

Similarly, Osprey has had tough times and the company has laid off 15 staff since last summer. The company currently has less than 10 staff members. Osprey demands compensation from Grayscale.

Soruce : https://tr.cointelegraph.com/news/osprey-sues-grayscale-for-misrepresenting-likelihood-of-etf-approval

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