- BlackRock, the world’s largest asset management firm, has refiled its Bitcoin exchange-traded fund (ETF) application, designating Coinbase as the market surveillance partner.
- This move follows the Securities and Exchange Commission’s (SEC) initial assessment that the previous filing was inadequate, lacking crucial information.
In a renewed commitment to the blockchain sector, BlackRock Inc., the world’s leading asset manager, has resubmitted its application for a Bitcoin-focused ETF to the US Securities and Exchange Commission (SEC). This application, initially found to be lacking key information, has been updated to include Coinbase Global Inc. as the principal market surveillance partner.
Coinbase as Key Surveillance Partner
The reshaped application was submitted on behalf of BlackRock by Nasdaq, naming Coinbase, one of the most substantial digital currency exchanges globally, as a crucial surveillance ally for the proposed ETF. This partnership is likely to amplify the market surveillance capacity of the proposed ETF, bolstering its integrity and overall transparency.
Previously, BlackRock’s ETF application, initially submitted on June 15, had called for a surveillance-sharing agreement without identifying a specific exchange partner. This caused the SEC to express reservations about the initial filing. BlackRock’s response to the regulator’s feedback comes in line with similar actions taken by several other entities like Fidelity Investments, Invesco, VanEck, 21Shares, and WisdomTree.
Coinbase plays a significant role in dollar-to-bitcoin trading in US-based platforms, representing approximately 56% of trading volume YTD, according to the new filing. The exchange’s pivotal involvement underscores the importance of the partnership, as it could improve oversight and reduce potential fraud or manipulation in the spot market.
In recent years, the SEC has shown a cautious willingness to permit ETFs based on Bitcoin futures, and even more recently, a leveraged Bitcoin futures fund. If approved, BlackRock’s spot Bitcoin ETF would be the first of its kind.
The submission of BlackRock’s revised filing is not just a milestone for the firm but also an influential event for the larger cryptocurrency market. It has encouraged several other companies to file for similar crypto-based products, sparking a considerable rally in the broader cryptocurrency market. Consequently, Bitcoin, the world’s largest cryptocurrency, has surged more than 80% YTD and risen by over 10% in the last month alone.
BlackRock’s foray into the blockchain space, with a sharp focus on a Bitcoin ETF, signals a shift in the traditional finance sector’s approach towards cryptocurrency. This progression brings the promise of enhanced transparency, increased liquidity, and further mainstream acceptance for Bitcoin and other cryptocurrencies.