In a boost for the crypto industry, the world's largest asset manager is planning a Bitcoin spot ETF. Blackrock is collaborating with Coinbase, which was recently sued by the SEC.
The crypto industry is coming under heavy regulatory pressure in the US, but it's now getting support from the world's largest asset manager. Blackrock filed an application in the US on Thursday for a bitcoin exchange-traded fund (ETF) allowing investment in the cryptocurrency.
If approved, it would be the first crypto spot ETF in the United States.
Collaborating With Coinbase
According to filings with the SEC, Coinbase Custody Trust will hold the fund's bitcoin holdings, while the Bank of New York Mellon will act as the custodian for the fiat holdings. The «iShares Bitcoin Trust» is expected to trade as a commodity-based trust. Last year, the world's largest asset manager launched a private spot Bitcoin trust for institutional clients in the US.
Despite numerous applications, the SEC has yet to approve a Bitcoin spot ETF, with the regulator so far only approving derivative-based products.
String of Rejections
Last year, the SEC rejected, among others, crypto asset manager Grayscale Investment's application to convert the publicly traded Grayscale Bitcoin Trust (GBTC) into an ETF which led to Grayscale suing the SEC.
Grayscale is the world's largest cryptocurrency asset manager and converting GBTC into an ETF or a bitcoin ETF would close the trust's discount, according to the company.
Third Time Lucky?
Cathie Wood's Ark Invest, along with Switzerland's 21Shares, are among the firms seeking to launch a bitcoin spot ETF in the United States, having filed their third application in April. The SEC also rejected bitcoin spot ETF proposals from Fidelity and Cboe Global Markets.
Blackrock's push comes at a time when the SEC has sued two major crypto exchanges, Coinbase and Binance. Given the intense regulatory pressure in the US, Blackrock's plans now come as something of a surprise.
