- Nasdaq resubmits requests for spot Bitcoin ETF, including surveillance-sharing agreement.
- Valkyrie persists in seeking SEC approval for spot BTC ETF.
- Transitioning to spot ETFs could legitimize cryptocurrencies for institutional investors.
Nasdaq, the renowned stock exchange, has resubmitted its request for a rule change to the U.S. Securities and Exchange Commission (SEC) to allow the listing of a spot Bitcoin exchange-traded fund (ETF) for the Valkyrie Bitcoin Fund.
This recent filing on July 3 included a notable addition—a “surveillance-sharing agreement” with Coinbase, the prominent cryptocurrency exchange. The agreement aims to grant Nasdaq supplementary access to data regarding spot Bitcoin trades, which may enhance the chances of regulatory approval.
In the past week, other asset managers, namely BlackRock and Fidelity, have followed suit and included surveillance-sharing agreements in their ETF refilings. On June 30, the SEC expressed concern that previous crypto ETF filings with Nasdaq and Cboe needed more clarity and comprehensiveness. This hint from the regulatory body suggests that surveillance arrangements could prove beneficial in securing approval for the applications.
Valkyrie also re-filed their 19b-4, like BlackRock they mention specific SSA agreement w/ Coinbase, even seems more aggressive (more use of the words ‘executed’ and ‘agreement’) They also, like BlackRock, call Coinbase largest US spot bitcoin exch h/t @NateGeraci pic.twitter.com/NDYKSzJeq9
— Eric Balchunas (@EricBalchunas) July 5, 2023
Valkyrie’s Persistence in Pursuing a Bitcoin ETF
Valkyrie, a cryptocurrency fund manager, has persistently sought approval for its spot BTC ETF from the SEC. While their most recent attempt was made in June, the company has applied for such an investment vehicle since 2021. Despite successfully launching an ETF tied to Bitcoin futures in October 2021, Valkyrie has yet to gain approval for a spot ETF linked directly to cryptocurrency.
Numerous firms have sought SEC approval for crypto investment vehicles over the past few years, albeit failing to succeed. Following the denial of Grayscale Investments’ spot Bitcoin ETF in June 2022, the investment firm filed a lawsuit accusing the regulator of inconsistent treatment towards similar investment vehicles.
However, the inclusion of surveillance-sharing agreements in recent ETF filings suggests that market participants adapt their strategies to appease regulatory concerns. Significantly, this shift may impact the prospects of approving Bitcoin ETFs, potentially paving the way for increased institutional participation in the crypto market. Consequently, if the SEC deems the surveillance arrangements satisfactory, it could mark a significant turning point for the industry.
With Nasdaq resubmitting its request for a Valkyrie Bitcoin ETF and including a surveillance-sharing agreement with Coinbase, the path toward approving a spot is evolving.
The recent inclusion of similar agreements by BlackRock and Fidelity underscores the industry’s commitment to addressing regulatory concerns. Moreover, crypto awaits a breakthrough as the SEC aims for clarity and comprehensive information in these filings. Transitioning from futures-based ETFs to spot ETFs could further legitimize cryptocurrencies in the eyes of institutional investors, potentially driving significant growth in the market.
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