Valkyrie’s Spot Bitcoin ETF Taps BitGo for Diversified Coin Custody

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Valkyrie Boosts Security with BitGo as Custodian for Bitcoin ETF

  • Valkyrie has officially added BitGo to its list of custodians, as revealed in a regulatory filing on Thursday.
  • Despite the addition of BitGo, Valkyrie reassured stakeholders that it remains committed to maintaining Coinbase Trust Company as another custodian.
  • The move by Valkyrie aligns with industry trends, as many spot Bitcoin ETFs that have received approval from the SEC opt for Coinbase as their custodian.

In a strategic move to enhance the security and custodial services for its spot Bitcoin exchange-traded fund (ETF), Valkyrie has officially added BitGo to its list of custodians, as revealed in a regulatory filing on Thursday. This decision is aimed at further fortifying the protection of the Trust’s Bitcoin holdings.

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Despite the addition of BitGo, Valkyrie reassured stakeholders that it remains committed to maintaining Coinbase Trust Company as another custodian for the Bitcoin ETF. The diversification of custodial services aims to provide additional layers of security and risk mitigation for Valkyrie’s ETF.

“The Sponsor anticipates utilizing the custodial services of both Coinbase and BitGo to custody the Trust’s bitcoin,” stated Valkyrie in the regulatory filing.

BitGo Enlistment a Trend Among ETFs

The move by Valkyrie aligns with industry trends, as many spot Bitcoin ETFs that have received approval from the Securities and Exchange Commission (SEC) opt for Coinbase as their custodian. Notable ETF issuers such as BlackRock, Bitwise, and Ark21 have Coinbase as their custodian. Furthermore, the recently approved Hashdex spot Bitcoin ETF also enlisted BitGo as its custodian.

Mike Belshe, CEO of BitGo, expressed his enthusiasm about Valkyrie’s decision in a post on X (formerly Twitter). He emphasized the significance of this collaboration for the industry, stating, “Valkyrie has added BitGo as a custodian for their Bitcoin ETF. This is a huge win for the industry as we partner to secure their assets.”

Belshe also extended commendations to Valkyrie’s leadership, acknowledging their forward-thinking approach to mitigating risks associated with ETF custody.

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Competition Among Spot ETFs Call for Strategies to Boost Profitability

As the competition among spot Bitcoin ETF issuers intensifies, firms are exploring various strategies to boost profitability. Bloomberg News reports that fee reductions have become a common tactic, with Invesco and Galaxy’s spot Bitcoin ETF recently lowering their fees from 0.39% to 0.25%. Similarly, Fidelity adjusted its fee to 0.25%, down from the previous 0.39%, just before receiving approval for its spot Bitcoin ETF.

This dynamic landscape signals a competitive race among ETF providers to not only attract investors but also to implement measures that enhance the security and cost-effectiveness of their offerings. Valkyrie’s move to include BitGo as a custodian aligns with this trend and reflects the industry’s commitment to staying ahead in an evolving market.

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