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Coinbase Stock Climbs Higher After BlackRock, Cboe Bitcoin ETF Surveillance Sharing

2 mins
Updated by Kyle Baird
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In Brief

  • Coinbase experienced a significant surge in its stock price after being named the surveillance-sharing partner in recent ETF applications.
  • But, some fund managers expressed skepticism about Coinbase's future, suggesting spotential risks to the platform's revenue.
  • Recently, the SEC raised concerns about inadequate filings from BlackRock and Fidelity around their exchange-traded products.
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Coinbase stock recorded a significant surge after BlackRock refiled its Bitcoin exchange-traded fund (ETF) application with a special mention of the exchange. In the June 29 filing with the US SEC, Coinbase was named as the surveillance-sharing partner for the spot product.

The resubmission comes after the SEC raised concerns about inadequate filings and urged on specifics of surveillance agreements.

BlackRock, Fidelity Refiles Bitcoin ETF Applications

Prominent asset manager BlackRock resubmitted its spot Bitcoin ETF application to the U.S. Securities and Exchange Commission (SEC). As reported by Bloomberg analyst Eric Balchunas, the filing was updated by Nasdaq with BlackRock’s intent to launch the ETF. Notably, Nasdaq-listed Coinbase has been included as the surveillance-sharing partner.

Coinbase’s role as the surveillance-sharing partner comes amid SEC’s concerns around a spot product and legal actions against the US-based exchange.

Meanwhile, exchange operator Chicago Board Options Exchange also refiled an application for asset manager Fidelity with the SEC. This filing was also a push for Coinbase as it was named the crypto platform to monitor market manipulation.

Coinbase gained over 25% over five days, as per Google Finance. However, Reuters cited sources that Cboe seeks to clarify the SEC’s concerns. The agency reportedly had similar concerns with Nasdaq over Blackrock’s filing.

SEC Highlights Inadequate Filings

The SEC recently deemed the applications filed by BlackRock and Fidelity Bitcoin ETFs as “inadequate.” BeInCrypto indicated in its report that SEC rejected the filings because of insufficient details.

In the case of Blackrock, the main issue was the absence of the spot Bitcoin exchange name with which the asset managers had entered into a surveillance-sharing agreement.

Read about the Coinbase IPO to understand its implications on the sector: Coinbase IPO: What It Is and What It Means for the Industry

Additionally, the watchdog stressed comprehensive and transparent filings. It asked to include the specifics of surveillance agreements and noted other deficiencies in their filings. Both parties had said that they resubmit the applications with the required changes.

While this happened, Bitcoin’s value had nosedived as another SEC concern sparked panic. However, the market regained confidence, with Bitcoin’s price keeping resilient above the $30,000 level.

Fund Managers Express Skepticism About COIN Price

At press time, Coinbase has daily gains of close to 12%. However, some fund managers remain cautious about the platform’s prospects. Chase Coleman of Tiger Global, an equity fund manager, took to Twitter to maintain a short position for the COIN stock.

The manager expressed its negative sentiment, stating, “It’s dog **** wrapped in cat ****.” The professional also advised investors to approach core positions unemotionally and emphasized the need for risk management in volatile markets.

Analysts at Berenberg Capital gave a price target of $39 for Coinbase stock and are shorting it.

Coinbase Stock COIN Price. Source: TradingView
Coinbase Stock COIN Price. Source: TradingView

They raised concerns about a possible cease and desist order related to Coinbase’s staking program. They also anticipate potential revenue loss from interest income on USDC and ongoing legal challenges from regulatory bodies.

However, despite these concerns, Coinbase shares are up 137% year-to-date, but skepticism in the market remains as the industry continues to mature.

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Shraddha Sharma
Shraddha is an India-based journalist who worked in business and financial news before diving into the crypto space. As an investment enthusiast, she has also has a keen interest in understanding crypto from a personal finance standpoint.
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