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Coinbase Custody has made adjustments in preparation for its role in pending spot Bitcoin ETFs, Bloomberg reported on Dec. 29.

A Coinbase representative said:

“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.”

Part of those changes involve executive reshuffling, according to Bloomberg. Aaron Schnarch, CEO of Coinbase Custody, reportedly stepped down. He has been replaced by Rick Schonberg, an employee of Coinbase since 2021 who has previously held roles in traditional finance including at Goldman Sachs.

Financial institutions are generally required to store cryptocurrency with a qualified custodian, such as Coinbase Custody, rather than with a retail exchange. Bloomberg noted that multiple ETF applicants including including BlackRock, Franklin Templeton, and Grayscale Investments plan to work with Coinbase Custody to manage Bitcoin holdings for their ETFs.

VanEck incidentally named Coinbase Custody as a possible additional custodian in its latest update, though it primarily will rely on Gemini for custody.

Apart from Coinbase Custody’s role as custodian, many ETF applications added Coinbase itself in surveillance-sharing agreements this summer. That role has seemingly helped to satisfy regulators’ concerns over market manipulation.

Several last-minute amendments have arrived

Coinbase Custody’s latest statements arrive alongside several last-minute amendments from spot Bitcoin ETF applicants. BlackRock and Valkyrie submitted updates identifying authorized providers, while VanEck submitted an amendment affirming its reliance on cash creation and redemption models.

Invesco, Fidelity, WisdomTree, and Bitwise additionally filed amendments on Dec. 29. Ark Invest, Grayscale, and Pando Asset AG have filed updates since Dec. 21.

Dec. 29 also marks the last day for spot Bitcoin applicants to modify their filing. The SEC must reach a decision on whether to approve Ark Invest’s spot Bitcoin ETF by Jan. 10, 2024. It may approve other applications at that time.

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