The race to launch the first Bitcoin exchange-traded fund (ETF) in the United States is heating up, with ARK Invest adding a surveillance sharing agreement to its application.
The amendment, which was filed with the Securities and Exchange Commission (SEC) on June 27, 2023, allows ARK to share information about its Bitcoin holdings with the Chicago Mercantile Exchange (CME) and a crypto exchange, most likely Coinbase.
This is the latest development in the long-running saga of Bitcoin ETFs in the United States. The SEC has denied several previous applications for Bitcoin ETFs, citing concerns about market manipulation and investor protection.
However, there is growing momentum for Bitcoin ETFs in the US. In April 2023, BlackRock filed an application for a Bitcoin ETF, which is seen as a major step forward.
The addition of a surveillance sharing agreement to ARK’s application could give it a leg up on the competition. The agreement will allow the SEC to more closely monitor the Bitcoin holdings of ARK’s ETF, which could help to address some of the concerns that the SEC has raised in the past.
What is a Bitcoin ETF?
A Bitcoin ETF is a type of investment fund that tracks the price of Bitcoin. ETFs are traded on exchanges like stocks, which makes them easy to buy and sell.
Bitcoin ETFs have the potential to make Bitcoin more accessible to investors. Currently, the only way to invest in Bitcoin is to buy it directly from a crypto exchange. This can be a complicated and risky process.
ETFs offer a more convenient and regulated way to invest in Bitcoin. They also offer diversification, which can help to reduce risk.
Why is the SEC hesitant to approve Bitcoin ETFs?
The SEC has been hesitant to approve Bitcoin ETFs because of concerns about market manipulation and investor protection.
The SEC is worried that Bitcoin is too volatile and that it could be easily manipulated by large investors. The SEC is also concerned that investors who invest in Bitcoin ETFs may not understand the risks involved.
What are the chances of ARK’s Bitcoin ETF being approved?
It is difficult to say what the chances are of ARK’s Bitcoin ETF being approved. The SEC has not yet made a decision on any Bitcoin ETF applications.
However, the addition of a surveillance sharing agreement to ARK’s application could give it a better chance of being approved. The agreement will allow the SEC to more closely monitor the Bitcoin holdings of ARK’s ETF, which could help to address some of the concerns that the SEC has raised in the past.
Conclusion
The race to launch the first Bitcoin ETF in the United States is heating up. ARK Invest’s addition of a surveillance sharing agreement to its application is a major step forward. It remains to be seen whether the SEC will approve ARK’s ETF, but the addition of the agreement could give it a better chance.
The Future of Bitcoin ETFs
If ARK’s Bitcoin ETF is approved, it is likely to pave the way for other Bitcoin ETFs to be approved. This could lead to a surge in investment in Bitcoin, which could drive up the price of the cryptocurrency.
Bitcoin ETFs could also make Bitcoin more accessible to investors. This could help to grow the cryptocurrency market and make it more mainstream.
The future of Bitcoin ETFs is uncertain, but the potential benefits are significant. If Bitcoin ETFs are approved, they could have a major impact on the cryptocurrency market.
