- Coinbase Custody CEO Aaron Schnarch steps down, replaced by Rick Schonberg.
- Multiple ETF applicants, including BlackRock and Grayscale, choose Coinbase Custody.
- Deadline day sees last-minute amendments from major ETF contenders.
In anticipation of the potential approval of spot Bitcoin Exchange-Traded Funds (ETFs), Coinbase Custody has undertaken significant preparations, as reported by Bloomberg on December 29.
A representative from Coinbase stated, “We have extensively prepared for ETF approval… Our systems have been designed and tested to handle added trading volume, increased liquidity, and general increases in demand on our systems.”
As part of these preparations, executive changes have taken place within Coinbase Custody. Aaron Schnarch, the former CEO, has reportedly stepped down, making way for Rick Schonberg, who joined Coinbase in 2021 and brings with him a wealth of experience from traditional finance, including a stint at Goldman Sachs.
Notably, financial institutions seeking to launch ETFs are required to entrust their cryptocurrency holdings to a qualified custodian, such as Coinbase Custody, rather than a retail exchange. Bloomberg highlighted that prominent ETF applicants like BlackRock, Franklin Templeton, and Grayscale Investments are planning to collaborate with Coinbase Custody for managing their Bitcoin holdings.
Coinbase Custody has also been named as a potential additional custodian by VanEck in its latest update, although the primary custodial reliance will be on Gemini.
Aside from its custodial role, Coinbase has played a crucial part in addressing regulators’ concerns over market manipulation. Several ETF applications have included Coinbase in surveillance-sharing agreements this summer.
In the lead-up to the deadline for modifications on December 29, spot Bitcoin ETF applicants, including BlackRock, Valkyrie, VanEck, Invesco, Fidelity, WisdomTree, Bitwise, Ark Invest, Grayscale, and Pando Asset AG, have submitted last-minute amendments. These amendments range from identifying authorized providers to affirming reliance on cash creation and redemption models.
Notably, December 29 marked the final day for spot Bitcoin ETF applicants to make modifications. The Securities and Exchange Commission (SEC) is expected to make a decision on Ark Invest’s spot Bitcoin ETF by January 10, 2024, with the possibility of approving other applications concurrently.
Disclaimer: Please note that the viewpoints and perspectives expressed by the author, as well as any individuals referenced in this article, are intended solely for informational purposes. They should not be construed as financial or investment advice. It’s important to acknowledge that investing in or trading cryptoassets carries inherent financial risks.