Grayscale has announced a legal challenge to the latest rejection of its application to convert the Grayscale Bitcoin Trust (GBTC) into a spot-based Bitcoin exchange-traded fund (ETF) by the Securities and Exchange Commission.

It announced that its Senior Legal Strategist, former U.S. Solicitor General, and partner at Munger, Tolles & Olson, Donald B. Verrilli, Jr. had filed a petition for review with the United States Court of Appeals for the District of Columbia Circuit.

According to a filing from the securities regulator on June 29, the application was disapproved “to protect investors and the public interest” because the proposal failed to demonstrate how it is “designed to prevent fraudulent and manipulative acts and practices.”

A similar decision was also made on Wednesday regarding Bitwise’s Bitcoin exchange-traded product (ETP) citing the same reasons.

Grayscale Investments, which has $12.92 billion of assets under management in its GBTC had been waiting on a decision from the SEC to convert its flagship Bitcoin trust into a spot-based ETF since filing its application to the regulator on October 19, 2021.

The decision comes out a full week before the July 6 deadline.

Earlier this month, Grayscale announced it had hired a former U.S. Solicitor General Donald B. Verrilli Jr. in preparation for a potential legal spat with the SEC over its application should it be rejected.

Other attorneys in Grayscale’s legal line-up include attorneys at Davis Polk & Wardwell LLP and its in-house counsel, including Craig Salm, who serves as chief legal officer.

In March, Grayscale CEO Michael Sonnenshein told Bloomberg that his firm would consider a lawsuit under the Administrative Procedure Act (APA) should the application for its Bitcoin Spot ETF be denied by the financial regulator.

On Wednesday, James Seyffart, an ETF analyst at Bloomberg Intelligence told his 19,400 Twitter followers that the SEC decision on both ETFs came earlier than he thought, but were both expected.

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