Spot Bitcoin ETF: BlackRock’s Game-Changing Proposal
BlackRock, a massive asset management company, has initiated the process of establishing a spot Bitcoin ETF, sparking debates among cryptocurrency proponents and federal regulators.
On Thursday, the company submitted an official request to the U.S. Securities and Exchange Commission to introduce the iShares Bitcoin Trust. If approved, the ETF would provide investors with a convenient means to gain exposure to cryptocurrency through a product offered by a major player in the financial industry.
“The Shares are intended to constitute a simple means of making an investment similar to an investment in Bitcoin rather than by acquiring, holding and trading Bitcoin directly on a peer-to-peer or other basis or via a digital asset exchange,” the filing said.
The approval of a spot Bitcoin ETF in the United States has been met with resistance by the SEC thus far. Currently, the regulator is engaged in a legal dispute with Grayscale regarding the conversion of its Grayscale Bitcoin Trust into an ETF, with a decision anticipated later this year.
Numerous other companies have submitted and subsequently withdrawn applications to launch spot Bitcoin funds. If the SEC changes its stance, the market could see a surge of such products being introduced.
Typically, it takes several months for an ETF to launch after the initial filing, assuming it gets the green light. Aisha Hunt, a principal at the asset management law firm Kelley Hunt & Charles, expects the proposed BlackRock fund to face significant opposition from the SEC, potentially leading to the withdrawal of the filing before an ETF is ever launched.
BlackRock’s decision to pursue a spot Bitcoin ETF comes at a time when cryptocurrency prices are well below their previous peak, and the industry is facing heightened scrutiny in Washington, D.C.
Recently, the SEC filed lawsuits against Coinbase and Binance, alleging that both platforms were operating unregistered securities exchanges. Additionally, Binance was accused of mixing customer funds with its own.
We did an article on Binance here.
We did an article on Coinbase here.
Coinbase is designated as the Bitcoin custodian for the proposed BlackRock ETF, as the two companies have an established strategic partnership. Last year, they announced that BlackRock’s institutional investment platform, Aladdin, would be linked to Coinbase Prime for crypto trading and custody services.
Good news in the cryptocurrency landscape seems rare at the moment, a sigh of relief for some. But they always come around.
This was how it was:
And this is how it’s going:
