Coinbase’s Shares Jump 13% on Cboe’s Partnership Announcement
Coinbase, the leading cryptocurrency platform in the United States, experienced a significant surge in its shares, increasing by 13%. This surge came after the exchange operator Cboe revealed its collaboration with Coinbase in the development of a spot bitcoin exchange-traded fund (ETF).
Cboe’s Application Refile Addresses SEC Concerns
Cboe refiled its application with the U.S. Securities and Exchange Commission (SEC) to launch a bitcoin ETF in partnership with asset manager Fidelity. Notably, the filing explicitly named Coinbase as the crypto platform responsible for aiding in detecting fraud and manipulation in the ETF.
SEC’s Concerns Extended to Nasdaq and BlackRock
The SEC expressed concerns to Nasdaq regarding a similar filing for a spot bitcoin ETF by BlackRock. The regulatory body sought transparency regarding the crypto-trading platforms that would assist in identifying fraudulent activities in the underlying bitcoin markets.
Addressing Fraud Concerns in the ETF Industry
Spot bitcoin ETF applications have faced numerous rejections from the SEC due to concerns over fraudulent and manipulative practices, along with investor protection. The ETF industry is actively exploring solutions to address these concerns.
Coinbase’s Strong Performance and Recent Regulatory Actions
Coinbase shares closed 11.7% higher, reaching $79.93, demonstrating robust growth throughout the year. This surge coincides with the filing of bitcoin ETFs by BlackRock and Fidelity, which caused Bitcoin, the world’s largest cryptocurrency, to reach a one-year high.
However, it’s important to note that the regulatory landscape has also intensified for Coinbase and Binance. The SEC recently filed lawsuits against both platforms, alleging rule violations and signaling an increased focus on regulation within the digital asset sector. Both Coinbase and Binance deny these allegations.
Bitcoin, currently trading at $31,029, experienced a 1.32% increase, while Ethereum, the second-largest cryptocurrency, rose by 1.94% to $1,964.
In summary, Coinbase’s collaboration with Cboe in the Bitcoin ETF application has positively impacted its shares, addressing concerns raised by the SEC. The crypto market continues to evolve amidst regulatory scrutiny, with both positive developments and increased regulatory actions shaping its trajectory.