Bitcoin ETF Race Heats Up: Fidelity Teams Up with Coinbase to Secure SEC Approval

The recent surge of interest in Bitcoin ETFs has attracted significant attention, as renowned companies race to submit applications to the U.S. Securities and Exchange Commission (SEC). This growing enthusiasm marks a pivotal moment in the development of Bitcoin investment opportunities.

Read on to know what’s the latest update in this space.

The Race for Spot Bitcoin ETFs

In the past few weeks, prominent names such as Fidelity, WisdomTree, VanEck, ARK Invest, Galaxy/Invesco, and BlackRock have all filed applications for spot Bitcoin ETFs. These companies are determined to succeed in launching a product that was previously rejected by the SEC.

Notably, Coinbase has announced its partnership with Fidelity and other Bitcoin ETFs to provide surveillance services, as stated in the refiled applications. This collaboration underscores the increasing significance of Coinbase, as well as its commitment to market oversight and monitoring.

Cboe and Coinbase: A Match Made in Heaven?

Cboe’s BZX Exchange has selected Coinbase as its preferred market for a surveillance-sharing agreement, as outlined in the refiled applications for its spot Bitcoin ETF issuers. This decision follows the SEC’s critique of the initial applications for failing to disclose the market involved in the surveillance-sharing agreements, as reported by the Wall Street Journal.

In the updated applications, Cboe acknowledges Coinbase’s influential role in U.S.-based and USD-denominated Bitcoin trading. By partnering with Coinbase for surveillance-sharing, Cboe aims to bolster its position in the Bitcoin ETF sector and address the SEC’s concerns regarding market oversight.

Understanding the Importance of the Spot BTC SSA

The anticipated surveillance-sharing agreement, known as Spot BTC SSA, aims to provide Cboe with additional access to data on spot Bitcoin trades conducted on Coinbase. This data will augment Cboe’s surveillance program for Commodity-Based Trust Shares, aligning with the information-sharing practices of the International Surveillance Group (ISG).

The SEC has consistently emphasized the importance of surveillance-sharing agreements with markets of “significant size.” These agreements are crucial in safeguarding consumers, preventing market manipulation, and deterring unwanted behaviors. The absence of such agreements has been a key factor in the SEC’s previous rejections of Bitcoin ETF applications.

SEC Review Pending

Formal acknowledgement from the SEC regarding the review of these applications is still pending. Once published in the Federal Register, the filings will initiate a 45-day review period. The SEC has the authority to extend this period to a maximum of 240 days, allowing for a thorough evaluation of the applications.

Cboe’s strategic decision to partner with Coinbase for the surveillance-sharing agreement reflects its dedication to regulatory compliance and market integrity. By addressing the SEC’s requirements, Cboe aims to strengthen oversight in the cryptocurrency space and potentially facilitate broader acceptance and approval of Bitcoin ETFs.