Valkyrie Investments has resubmitted its application for a spot Bitcoin exchange-traded fund (ETF) in the United States, making a significant update by including a surveillance-sharing agreement with Coinbase. It is important to note that the sudden move comes as a response to the U.S. Securities and Exchange Commission’s (SEC) request for more clarity and comprehensiveness in the applications.
Partnership with Coinbase to meet SEC’s surveillance requirements
Nasdaq and Cboe Global Markets, the two main stock exchanges where the ETFs are expected to be listed, have entered into agreements with Coinbase to meet the SEC’s surveillance requirements. The SEC had previously returned the applications, requesting the identification of a spot Bitcoin exchange to serve as a surveillance-sharing partner.
Valkyrie’s revised filing represents a significant change in its stance on spot Bitcoin ETFs and potentially reflects a shift in sentiment among regulators and the traditional financial industry. The company has previously operated Bitcoin-related funds based on futures and had expressed doubts about the approval of spot ETFs until crypto exchanges are regulated. However, Valkyrie’s updated application showcases its stance in the regulatory acceptance of spot Bitcoin ETFs.
The recent wave of refilings, including those from asset managers BlackRock and Fidelity, has incorporated surveillance-sharing agreements. This adjustment aims to address the SEC’s request for more clarity and comprehensive details. The SEC’s feedback on Nasdaq and Cboe’s filings had emphasized the need for greater transparency, implying that surveillance arrangements could improve the chances of regulatory approval.
Valkyrie’s pursuit of a spot BTC ETF approval dates back to 2021, with their most recent attempt in June. While the company successfully launched an ETF linked to Bitcoin futures in October 2021, gaining approval for a spot ETF has remained challenging. Several firms have applied for spot Bitcoin ETFs with the SEC over the years, but none have received regulatory approval.
Valkyrie’s decision to include Coinbase as a surveillance-sharing partner indicates a potential change in the regulatory landscape and a willingness to consider spot Bitcoin ETFs. The partnership acknowledges the importance of meeting the SEC’s requirements and demonstrates industry efforts to address concerns and provide greater clarity.
The outcome of these refilings and the SEC’s response will significantly impact the future of spot Bitcoin ETFs and may open up new opportunities for investors in the cryptocurrency market.
