ARK’s changes could make it the first to launch a Bitcoin spot ETF in the U.S., beating BlackRock.
Cathie Wood’s ARK Invest has revised its Bitcoin spot ETF filing to include a new monitoring sharing agreement, drawing on investment giant BlackRock’s filing earlier this month.
The modification could allow ARK's product to gain approval from the U.S. Securities and Exchange Commission (SEC), which has so far denied all flavors of the product.
Big changes to ARK
According to ARK’s revised 19b-4 filing, the proposal recommends that the Cboe BZX exchange, where Ark’s 21-share ETF will be listed, will enter into a supervisory sharing agreement (SSA) with “a U.S. spot trading operator of a Bitcoin platform.” . "
ARK did not disclose which specific spot exchange it would work with, but claimed that it represents “a large portion of U.S. Bitcoin trading.”
Ark said that “the Spot BTC SSA, combined with information obtained through the Intermarket Surveillance Group related to CME Bitcoin Futures (which the Exchange believes represents a sizable regulated market in its own right), will further enhance the Exchange’s ability to detect and prevent manipulative activity at stake.”
Ark’s last ETF application was rejected in January due to an inability to form an adequate oversight-sharing agreement on bitcoin spot trading.
While other companies like Ark and Grayscale have proposed entering into this agreement with CME Bitcoin futures, the SEC claims that the market is not connected enough to allow spot Bitcoin trading.
Ark defended its use of CME bitcoin futures, saying other ETFs have been approved for commodities that use the relevant CME futures market as a “larger regulated market.” In addition, many commodity- and currency-based ETFs have unregulated spot markets, including gold, silver, platinum, palladium, and copper.
BlackRock Documents
BlackRock’s own 19-b4 filing contains the same paragraph as Ark regarding their respective stock exchange, Nasdaq, establishing an SSA with a U.S. spot bitcoin exchange.
Ark’s application puts the company in a position to get approval ahead of BlackRock because it filed first, said Eric Balchunas, an ETF analyst at Bloomberg.
Balchunas added that BlackRock could block Coinbase from participating in Ark’s SSA because the investment giant is already working with Coinbase on its own products.
