- Getting a spot Bitcoin ETF application through the SEC has been impossible.
- BlackRock has included an SSA, which has people optimistic.
- Ark Invest has poached the SSA idea to win the race.
Bitcoin ETF applications have come streaming across the traditional finance and crypto spheres. There is growing anticipation surrounding who will launch the first SEC-approved Bitcoin spot ETF and when.
BlackRock has been at the forefront of the ETF applications with their iShares Bitcoin Trust, with many hopeful the financial giant will convince the SEC to launch such a product.
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However, Ark Invest is also in the race to launch its ETF and has taken a leaf out of BlackRock’s application and could pip them to the post.
Copying BlackRock’s Success?
Before the ETF hype ramped up again, Ark submitted its proposal to the SEC in April, thanks to BlackRock. The firm has now decided to resubmit its proposal – but keep its place in the SEC queue – with an added section.
The Ark amendment adds a surveillance-sharing agreement, something BlackRock has in its application.
A surveillance-sharing agreement (SSA) refers to information that is shared with regulators in order to prevent potential market manipulation. Market manipulation has been a core fear of the SEC’s decision not to award a spot ETF thus far.
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An SSA would include sharing information about market trading activity, clearing activity, and customer identification. BlackRock’s decision to include an SSA would go a long way to appeasing the SEC, but perhaps Ark could do as much appeasing.
Ark Is First in Line
While BlackRock has a lot of optimism around its application, if its ace in the hole the SSA, ARK could leapfrog to become the first. The SEC would have to decide on Ark’s application before it approached BlackRock, meaning the impact of an added SSA will soon be seen.
Previously, rejected or pending applications had not included SSAs, including Cathie Wood’s ARK fund—which first applied for a spot Bitcoin ETF back in June 2021 together with global crypto ETF provider 21Shares.
In Wood’s case, regulators again cited a failure to prove how they could stave off market manipulation by cryptocurrency traders.
An SSA would go a long way to answering those questions and, if this is sufficient for the SEC, would make Ark the first to offer a spot in Bitcoin ETF.
On the Flipside
- The SEC recently approved a Bitcoin ETF – a leveraged Bitcoin futures ETF called Volatility Shares 2X Bitcoin Strategy ETF (BITX).
- In Hong Kong, HSBC opened up a Bitcoin ETF amid all the growing hype in the U.S.
Why this Matters
The floodgates are waiting to be opened regarding a spot Bitcoin ETF. To be the first to be approved will set up the firm that gets it right to be a leader in institutional Bitcoin trading, and Ark knows that.
Read more about some of the current applications:
Valkyrie & BlackRock Among Giants to Launch Bitcoin ETFs: Will the SEC Approve?
Read more about ‘Britcoin’:
Digital Pound: On Blockchain or Not? Private or Open? Here’s What We Know
