Bitcoin ETF Race Heats Up: Fidelity Teams Up with Coinbase for Enhanced Surveillance-Sharing

There’s been a lot of buzz around the Bitcoin ETFs recently, as several well-known companies are rushing to submit applications to the U.S. Securities and Exchange Commission (SEC). This surge of interest is a significant moment in the evolution of Bitcoin investment opportunities.

Big names like Fidelity, WisdomTree, VanEck, ARK Invest, Galaxy/Invesco, and BlackRock have all filed for spot Bitcoin ETFs in the past few weeks. They’re hoping to finally succeed in launching a product that the SEC has previously rejected.

While BlackRock has filed its application with Nasdaq, the other companies are working with Cboe. In an interesting development, it has been revealed that Coinbase will be partnering with Fidelity and other Bitcoin ETFs to provide surveillance services, as mentioned in the refiled applications.

Cboe Refiles Bitcoin ETF Applications, Names Coinbase as Surveillance-Sharing Partner

Cboe’s BZX Exchange has chosen the popular crypto exchange Coinbase as the market for its surveillance-sharing agreement, as revealed in the refiled applications for its spot bitcoin exchange-traded fund (ETF) issuers. 

The decision came after the U.S. Securities and Exchange Commission (SEC) deemed the initial applications “inadequate” due to the lack of naming the market involved in the surveillance-sharing agreements, as reported by the Wall Street Journal.

In the updated applications, Cboe acknowledged Coinbase as a significant player in U.S.-based and USD-denominated Bitcoin trading. By selecting Coinbase as its partner for surveillance-sharing, Cboe aims to strengthen its position in the Bitcoin ETF space and address the SEC’s concerns regarding market oversight and monitoring.

Cboe’s Spot BTC SSA Enables Enhanced Surveillance for Bitcoin ETFs

The anticipated surveillance-sharing agreement, known as Spot BTC SSA, aims to provide Cboe with supplementary access to data on spot Bitcoin trades occurring on Coinbase. This access will be utilized by Cboe as part of its surveillance program for Commodity-Based Trust Shares, mirroring the information-sharing practices within the International Surveillance Group (ISG).

The Securities and Exchange Commission (SEC) has consistently emphasized the importance of surveillance-sharing agreements with markets of “significant size.” Such agreements are seen as crucial measures to safeguard consumers, prevent market manipulation, and deter unwanted behaviors. The absence of these agreements has been a major contributing factor to the SEC’s previous rejections of Bitcoin ETF applications.

SEC Review Pending

Formal acknowledgment 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 review period to a total of 240 days, allowing for a comprehensive evaluation of the applications.

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

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• Source: https://coinpedia.org/news/bitcoin-etf-race-heats-up-fidelity-teams-up-with-coinbase-for-enhanced-surveillance-sharing/