Cboe Refiles Fidelity Bitcoin ETF Application After SEC Deemed Prior Application Inadequate

On June 30, reports emerged that the U.S. Securities and Exchange Commission (SEC) has returned recent spot Bitcoin exchange-traded fund (ETF) applications. The applications, submitted by exchanges on behalf of BlackRock and Fidelity Investments, among others, were deemed not “sufficiently clear or comprehensive.”

Fidelity, WisdomTree, VanEck, ARK Invest, Galaxy/Invesco and BlackRock all filed for spot bitcoin ETFs over the past few weeks, hoping to succeed at launching a product the U.S. Securities and Exchange Commission (SEC) has rejected for years. While BlackRock filed with Nasdaq, the other companies are working with Cboe.

An anonymous source cited by the Wall Street Journal shared that the applications failed to identify the spot Bitcoin exchange that would enter into a “surveillance sharing agreement” (SSA) with Nasdaq and Cboe. This agreement is a prerequisite for the SEC, aimed at preventing fraud and manipulation in the underlying market of an asset.

Cboe's BZX Exchange named crypto exchange Coinbase as the market for its surveillance-sharing agreement when it refiled its spot bitcoin exchange-traded (ETF) fund applications for several would-be bitcoin ETF issuers on Friday.

Complicating the SEC's calculus may be the fact that it sued Coinbase earlier this month on allegations of operating an unregistered securities exchange, broker and clearinghouse – though the SEC is not alleging that Bitcoin itself is a security, and SEC Chair Gary Gensler has often referred to it as an example of a digital asset that is not a security.

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