Cboe teams up with Cathie Wood on spot bitcoin ETF

If approved, the ARK 21Shares Bitcoin ETF would be the first spot bitcoin ETF to be listed and traded on a U.S. exchange. This is the third time that Cboe has submitted a proposal to the SEC for this ETF, after its previous two proposals were rejected, along with multiple other proposals from Grayscale, Fidelity, NYDIG, and many others.

Earlier in January, the SEC once again denied Cathie Wood’s application for a spot bitcoin exchange-traded fund (ETF). The application would have created the ARK Investment Management’s and 21 Shares’ Bitcoin ETF trade on the Chicago Board Options Exchange (CBOE) BZX Exchange.

The agency said the filing did not meet “the requirement that the rules of a national securities exchange be ‘designed to prevent fraudulent and manipulative acts and practices’ and ‘to protect investors and the public interest.”

Cathie Wood’s ARK Investment Management and 21Shares amended its application back after the SEC rejected their first proposal for an ETF that would invest directly in bitcoin. As part of the changes, the Switzerland-based investment-products issuer said its product would use US Bank as a qualified custodian, hoping such a tweak will win its bitcoin exchange-traded fund application the SEC’s blessing.

There are a number of applications underway to get a bitcoin ETF listed, but so far none have been approved by the SEC. The agency only extends the deliberation window or opened the matter to public comments to avoid reaching any decision on a proposal, meaning any new rejection will be no surprise.

Cboe’s first application was filed in collaboration with money management firm VanEck and Blockchain company SolidX in June 2018. At the time, some had argued that the proposal from New York-based VanEck, the ninth biggest ETF provider, was more likely to gain approval thanks to plans for a high minimum share price that would discourage retail investors.