BlackRock, one of the world’s largest asset management firm, has stirred up a fresh wave of optimism amongst traders and investors by filing for a Bitcoin Exchange-Traded Fund (ETF). The move marks a significant step towards making Bitcoin more accessible to retail and institutional investors alike.
The application, lodged on Thursday, proposes the iShares Bitcoin Trust, with Coinbase listed as the custodian of the underlying Bitcoin and NASDAQ overseeing the spot market price data.
The news has already had a tangible impact on the market, causing Bitcoin to regain the $25,500 level, erasing losses from the previous two days, and leading to over $16 million in short liquidations in BTC-tracked futures over the past 24 hours.
This ETF could offer a familiar and accessible option for the significant proportion of Americans who have yet to delve into Bitcoin.
“An estimated 20% of Americans have now owned bitcoin at some point. BlackRock’s proposed ETF potentially offers the other 80% an option that is altogether more familiar and accessible”, commented Sui Chung, CEO of CF Benchmarks
However, it’s noteworthy that this is at least the 33rd attempt by issuers for a spot-Bitcoin product. Previous efforts, including those from Grayscale, VanEck, and WisdomTree, have been rejected by the U.S. Securities and Exchange Commission (SEC) due to concerns over market manipulation and a lack of investor protections.
While there are options such as the Grayscale Bitcoin Trust for acquiring Bitcoin in the form of shares, these often come with steep management fees and lack the ease of trading on a major stock exchange. The BlackRock ETF, if approved, could address these limitations.
Despite previous applications for Bitcoin ETFs being denied by the SEC, BlackRock’s application holds promise. The company’s pedigree, coupled with NASDAQ’s oversight of the pricing data, could ease regulatory concerns around market manipulation.
In response to the filing, a BlackRock spokeswoman stated:
“We have filed a registration statement with the SEC, and due to regulatory filing restrictions, we are not able to provide further comment”.
The SEC has previously permitted a crypto ETF for futures markets, a decision that Grayscale is currently challenging in court. Analysts suggest that Grayscale might have a good chance to prevail, which could pave the way for BlackRock’s spot market ETF.
