California: BlackRock is trying its hand at potentially getting the first spot-Bitcoin exchange-traded fund launched in the US.
The world’s largest asset manager on Thursday applied for the iShares Bitcoin Trust, according to a filing with the US Securities and Exchange Commission. Coinbase Global Inc., the biggest crypto exchange in the US, would act as custodian. The ETF, should it launch, would trade on Nasdaq.
“We have filed a registration statement with the SEC, and due to regulatory filing restrictions, we are not able to provide further comment,” a BlackRock spokeswoman said in an emailed statement.
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The price of Bitcoin rose following the release to trade around $25,500.
“One might say that they are about as good as it gets at reading the regulatory tea leaves,” said James Seyffart at Bloomberg Intelligence.
The news was earlier partially reported by crypto-site CoinDesk, which hadn’t specified whether BlackRock was seeking out a spot ETF or a different structure. But given the asset manager’s stature in the world of finance “- it oversaw more than $9 trillion as of the end of March “- the announcement made a splash, especially among cryptocurrency backers who have for a long time argued such a product should be made available for trading.
BlackRock’s attempt at a spot Bitcoin ETF lands amid digital asset-manager Grayscale Investments’ high-profile legal battle with the Securities and Exchange Commission. Grayscale sued the regulator after it denied a bid to convert the Grayscale Bitcoin Trust into a physically backed ETF, citing fraud and manipulation concerns related to the underlying market.
“Perhaps BlackRock is in agreement with us in Bloomberg Intelligence that Grayscale is going to win their lawsuit with the SEC and they want to make sure their hat is in the ring in the event of an approval,” Seyffart said.
BlackRock has prior dealings with the crypto space. The company had partnered with Coinbase on making it easier for institutional investors to manage and trade Bitcoin.
Lots of issuers have over the years filed for spot-Bitcoin exchange-traded funds, though regulators have in the past been hesitant to green-light such a product. More recently, crypto exchange-traded-products issuer 21Shares, in partnership with Cathie Wood’s ARK Investment Management, refiled an application for a spot-Bitcoin ETF, arguing that such a fund would offer US investors protections that currently don’t exist.