Coinbase Custody Secures Key Role in Bitwise’s Pioneering SUI ETF Filing

In a significant development for institutional cryptocurrency adoption, asset manager Bitwise has officially filed with the U.S. Securities and Exchange Commission (SEC) to launch the first spot exchange-traded fund (ETF) for SUI, the native token of the Sui Network. The filing, submitted on Thursday via FORM S-1, marks a concrete step toward bringing direct exposure to the Layer 1 blockchain asset to a broader investor base through a regulated vehicle. The proposed 'Bitwise Sui ETF' aims to track the performance of SUI, which powers a blockchain designed from the ground up for high-speed, scalable digital asset management since its mainnet launch in 2023. A critical component of this filing is the selection of Coinbase Custody Trust Company as the custodian for the ETF's underlying SUI assets. This move reinforces Coinbase's dominant position in providing institutional-grade custody solutions for the digital asset industry, further cementing its role as a foundational infrastructure provider for traditional finance's entry into crypto. The filing underscores a growing trend of institutional demand for regulated access to specific blockchain assets beyond Bitcoin and Ethereum. The Sui Network, with its focus on parallel transaction execution and object-centric model, represents a newer generation of smart contract platforms seeking to solve scalability challenges. Bitwise's initiative signals confidence in SUI's market maturity and the viability of a single-asset ETF structure for alternative Layer 1 tokens. If approved, this ETF would provide investors with a familiar, brokerage-account-accessible product to gain exposure to SUI's price movements without the complexities of direct key management or trading on digital asset exchanges. The involvement of a major, SEC-regulated custodian like Coinbase is a pivotal factor in addressing regulatory concerns around asset safekeeping, a hurdle that has historically delayed the approval of spot crypto ETFs. This development, as of late 2025, highlights the accelerating convergence of traditional finance and the digital asset ecosystem, with trusted intermediaries like Coinbase playing an indispensable role in bridging the two worlds.

Bitwise Files for Spot SUI ETF Amid Growing Institutional Crypto Demand

Bitwise has taken concrete steps toward launching the first spot SUI ETF in the U.S., filing a FORM S-1 with the SEC on Thursday. The proposed 'Bitwise Sui ETF' would track the native token of the Sui Network, a LAYER 1 blockchain designed for high-speed transactions and scalable digital asset management since its 2023 debut.

Coinbase Custody is slated to serve as custodian, maintaining its dominant position in crypto ETF services. The filing comes as multiple firms race to bring SUI investment products to market, with Canary Capital and 21Shares having submitted similar proposals in March and April respectively.

Market participants await SEC decisions on these filings as institutional interest in alternative layer-1 tokens grows. No spot sui ETFs currently trade domestically despite this year's surge in crypto fund approvals.

Coinbase Challenges State Authority Over Prediction Markets in Three-State Lawsuit

Coinbase has initiated legal battles against Michigan, Illinois, and Connecticut, contesting state-level attempts to regulate prediction markets. The cryptocurrency exchange argues these markets fall under exclusive CFTC jurisdiction, not state gaming regulators.

The lawsuits follow Coinbase's partnership with CFTC-regulated platform Kalshi, with plans to launch US prediction market services by January 2026. Chief Legal Officer Paul Grewal emphasized the need for regulatory clarity, stating prediction markets are clearly commodities under federal oversight.

State regulators have classified prediction markets as gambling operations—a characterization Coinbase vehemently rejects. This legal confrontation highlights growing tensions between crypto innovators and traditional regulatory frameworks.

Coinbase Escalates Legal Battle Over Prediction Market Jurisdiction

Coinbase Global Inc. has filed lawsuits against Michigan, Illinois, and Connecticut, challenging state attempts to regulate prediction markets. The exchange argues these markets fall under exclusive federal oversight by the Commodity Futures Trading Commission (CFTC).

Chief Legal Officer Paul Grewal stated the lawsuits aim to prevent state interference in federally regulated activities. 'Congress deliberately excluded only specific commodities like onions and box office receipts from CFTC jurisdiction,' Grewal noted. 'All other subjects, including sporting events, clearly fall under federal purview.'

The legal filing emphasizes the Commodity Exchange Act grants the CFTC sole authority over swaps and derivatives—a category it contends includes event contracts. This MOVE signals Coinbase's broader strategy to preempt fragmented state-level crypto regulations.

Bitwise Joins Spot SUI ETF Race with SEC Filing

Bitwise has entered the competition for a spot SUI ETF, filing a Form S-1 with the SEC on December 19, 2025. The proposed fund WOULD track the native token of the Sui blockchain, offering direct exposure through Coinbase Custody and potential staking rewards. This move places Bitwise alongside 21Shares, Canary Capital, and Grayscale in a growing institutional scramble for altcoin ETFs.

The filing arrives as regulatory momentum builds for crypto-friendly structures, following earlier approvals for Bitcoin and Ethereum ETFs. SUI’s price rallied 4.5% on the news, reflecting market Optimism about broader altcoin accessibility.

Unlike derivative-based products, Bitwise’s ETF would hold actual tokens—a structure increasingly favored by institutions seeking unencumbered exposure. Coinbase’s involvement as custodian signals emphasis on security amid rising institutional demand.