BlackRock files for bitcoin ETF in push into crypto
BlackRock (BLK.N), the world’s biggest asset manager, last week filed for a bitcoin exchange-traded fund (ETF) that would allow investors to get exposure to the cryptocurrency, as the asset class comes under intense regulatory scrutiny.
BlackRock’s iShares Bitcoin Trust will use Coinbase Custody as its custodian, according to a filing with the US Securities and Exchange Commission (SEC). The US regulator has yet to approve any applications for spot bitcoin ETFs.
Last year, BlackRock launched a spot bitcoin private trust for institutional clients in the United States.
The move comes at a time when the global cryptocurrency industry has been caught in the crosshairs of the US securities regulator on alleged violations of securities laws.
Earlier this month, the regulator sued major exchanges Coinbase and Binance in high-profile lawsuits that reverberated through the digital assets industry.
“The fact that BlackRock, a well-respected and established asset management company, has filed for a Bitcoin ETF could be seen as a positive development in the quest for regulatory approval,” said Joshua Chu, group chief risk officer at blockchain technology group XBE, Coinllectibles and Marvion.
“It also shows resilience of the public’s interest in crypto.”
A spot bitcoin ETF would track bitcoin’s underlying market price. Proponents say an ETF would give investors exposure to bitcoin without directly buying it.
The SEC rejected Grayscale Investment LLC’s application last year to convert its flagship spot Grayscale Bitcoin Trust (GBTC.PK) into an ETF.
Grayscale sued the SEC, claiming that the regulator was acting arbitrarily in rejecting applications for spot bitcoin ETFs when it had previously approved bitcoin futures ETFs.
The SEC has also rejected proposals for spot bitcoin ETFs from firms including Fidelity, Cboe Global Markets and NYDIG.
Bitcoin prices closed up 2 per cent on Thursday after the announcement. They were last at $25,506 on Friday. The largest cryptocurrency is up 54 per cent in the year.
Plans for BlackRock’s ETF were reported by CoinDesk earlier in the day.