Grayscale said on May 17 that the US Securities and Exchange Commission (SEC) had asked it to withdraw the registration statement for its Filecoin Trust.
The SEC told Grayscale that Filecoin’s FIL token meets the definition of a security under the relevant laws. This in turn means that Grayscale’s Filecoin Trust is an investment company. Grayscale was told to withdraw its registration “immediately”.
Grayscale claimed that Filecoin’s FIL token is not a security and said it plans to respond to the SEC. However, Grayscale isn’t sure if the SEC will agree with its legal argument, allow it to seek accommodation or force it to dissolve the Filecoin Trust.
The news briefly saw the value of Filecoin drop from $4.59 to $4.46 in minutes, representing a sudden drop of 3%. However, the value of the asset has since recovered to $4.57.
Grayscale’s website lists its Filecoin Trust alongside numerous other cryptocurrency trusts, including the notable Grayscale Bitcoin Trust (GBTC).
It is unclear why the SEC specifically targeted the company’s Filecoin Trust. It is also unclear whether the securities regulator plans to take action against Filecoin itself or any of Grayscale’s other cryptocurrency trusts.
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