Coinbase is poised to benefit greatly from approving a spot Bitcoin ETF. However, its role as an intermediary in this approval process has drawn investigation from the Securities and Exchange Commission. The existing dispute between Coinbase and the SEC, as highlighted by Bloomberg’s Michael P. Regan, could result in doubt or delays in authorizing a spot Bitcoin ETF.
The approval of a spot Bitcoin ETF has been considered over ten years. Despite numerous proposals, the SEC has consistently denied these requests. Last year, the SEC brought legal proceedings against Coinbase, accusing the company of operating in various roles – as an exchange, broker-dealer, and clearinghouse – without the appropriate registrations. This legal challenge might pose a significant barrier to approving the Bitcoin ETF.
According to Bloomberg’s report, Coinbase would play an important role in securities operations, encompassing various functions like custody, trading execution, market observation, and lending. Even ETF issuers such as BlackRock have recognized their reliance on Coinbase, mentioning the SEC’s lawsuit against the platform in their risk statements.
Despite these challenges, analysts remain optimistic about the Bitcoin ETF’s approval. Reports from Fox Business and Bloomberg Intelligence analysts indicate a possibility of approval coming soon, perhaps even within this week. The consensus suggests a likely approval before the January 20, 2024, deadline.
The initiation of trading for a Bitcoin ETF could favor Bitcoin’s market sentiment Starting in early 2024. This development holds particular significance in light of the expected Bitcoin Halving event occurring later in the year. The proceeded for a Bitcoin ETF, followed by its active trading, might pave the way for a continued bullish phase in Bitcoin’s market trends.
Also read: Crypto Discussion Highlight Bitcoin ETFs, CPI, and Inflation
