Pushes by asset managers to launch spot bitcoin ETFs appeared to hit a setback late last week, but one exchange has refiled applications in hopes of addressing concerns
Coinbase Global Inc. shares roared higher in Monday’s session as asset managers continued their pushes for spot bitcoin exchange-traded funds and highlighted Coinbase’s potential to play a role in them.
Several institutional managers including BlackRock Inc. BLK, +0.35%, Fidelity, VanEck and WisdomTree have expressed interest over the past month in launching spot bitcoin ETFs, but The Wall Street Journal reported Friday that the Securities and Exchange Commission deemed their applications inadequate due to a lack of information about their surveillance-sharing partnership plans.
Coinbase shares COIN, +11.71% snapped a five-session winning streak Friday in the face of that report, but they rallied Monday in a big way, up 11.7% in the session.
The Cboe on Friday afternoon refiled applications for several of the companies that wish to create spot bitcoin ETFs, and these listed Coinbase as the exchange’s surveillance-sharing partner. The Cboe’s refiled applications were for Fidelity, WisdomTree, VanEck and Invesco products.
The exchange said the Coinbase arrangement would “supplement its ability to obtain information that would be helpful in detecting, investigating, and deterring fraud and market manipulation.”
BlackRock is looking to launch its bitcoin ETF through the Nasdaq and not the Cboe.
While the SEC has previously allowed bitcoin futures ETFs, it’s yet to grant approval for spot bitcoin ETFs, flagging the potential for market manipulation. There appears to be some optimism that the surveillance-sharing agreement could help win over regulators.
Coinbase’s Monday rally extended a sharp run higher in recent weeks. The stock is ahead 56% since the close of trading June 12, which was several days before BlackRock filed its application for its spot bitcoin ETF. The shares are also up 37% over the past seven trading sessions.
The stock secured its highest close since March 21, according to Dow Jones Market Data, ending the day at $79.93. A future finish above $83.99 would make for Coinbase’s highest close since Aug. 17, 2022, when it closed at $85.44.
A Berenberg Capital Markets analyst has concerns about Coinbase’s stock in light of its meteoric recent rise, however, flagging last week that while there was an opportunity related to spot bitcoin ETFs, the company faced the possibility of negative developments related to its crypto-staking program, which has caught the attention of federal and state regulators.
Other crypto-related stocks were seeing sizable lifts as well Monday, with shares of MicroStrategy Inc. MSTR, +10.34%, a software company that has sizable bitcoin holdings, ahead 9.7%. Shares of bitcoin miners Riot Platforms Inc. RIOT, +12.94% and Marathon Digital Holdings Inc. MARA, +10.53% were up 13.1% and 10.7%, respectively.