Cathie Wood’s ARK Investment Management and crypto asset manager 21Shares amended their application for a spot bitcoin exchange traded fund to include a surveillance sharing agreement, which was similar to that in BlackRock’s filing earlier this month.
The Cboe BZX Exchange Exchange, where the ARK 21Shares Bitcoin ETF will be listed, expects to enter into a surveillance-sharing agreement with “an operator of a United States-based spot trading platform for Bitcoin,” according to an updated filing with the Securities and Exchange Commission on Wednesday.
ARK Invest and 21Shares originally filed their application two years ago.
See: Cathie Wood’s ARK Invest is readying the first bitcoin ETF with 21Shares
The SEC approved several bitcoin
BTCUSD,
futures-based ETFs in the past, but has yet to greenlight anything that is backed by bitcoin itself.
Earlier this month, BlackRock
BLK,
the world’s largest asset manager, filed an application for a spot bitcoin ETF. Following that, Invesco
IVZ,
WisdomTree
WT,
Valkyrie, and Bitwise also applied to issue similar products.
Some people have speculated that a surveillance sharing agreement in BlackRock’s filing, which requires the sharing of information about market trading activity, clearing activity, and customer identity, could be a breakthrough to obtain the SEC’s approval.
“A notable difference between Blackrock’s filing and prior filings is that Blackrock will utilize software sourced from Nasdaq for monitoring spot markets for wash sales, market manipulation, and other market integrity measures,” Alex Thorn, head of firmwide research at Galaxy Digital, wrote in a recent note.
In its previous denials of spot bitcoin ETF applications, the SEC has repeatedly noted the lack of sufficient “surveillance sharing agreements” to mitigate and prevent market manipulation, according to Thorn.
ARK’s latest move could place the firm and 21Shares ahead of BlackRock in the competition of launching a spot bitcoin ETF, analysts said. ARK’s amendment of the filing “puts them in pole position to be approved first because they filed first,” according to Eric Balchunas, senior ETF analyst at Bloomberg.
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