Blackrock’s Bitcoin ETF Application Draws New Investors

The potential impact of BlackRock's Bitcoin ETF application on the crypto market is significant.

New applicants wanting to establish a spot in Bitcoin exchange-traded fund (ETF) have increased after BlackRock's application on June 15. WisdomTree and Invesco are the most recent applicants for a Bitcoin exchange-traded fund (ETF) from the US Securities and Exchange Commission (SEC).

Demand Grows For Spot Bitcoin ETF

WisdomTree formally requested permission to record its "WisdomTree Bitcoin Trust" and use the ticker symbol "BTCW" in a file submitted to the SEC on June 21. It's important to remember that WisdomTree has already tried twice to have a Bitcoin ETF approved.

Read More: Bitcoin ETFs: Enter the Cryptoverse Without Purchasing

The initial application was denied in December 2021, and a second denial was issued in October 2022 by the United States securities commission. When deciding against the platform, the regulatory agency cited risks of fraud and market manipulation.

At present, WisdomTree is responsible for the management of approximately $83 billion. BlackRock's latest proposal to the SEC differs from previous ones in that it proposes to establish a "surveillance sharing agreement" with the futures markets at the Chicago Mercantile Exchange (CME).

In its proposal, BlackRock makes mention of the SEC's approval of a Bitcoin futures fund proposed by Teucrium. The green light brought attention to the CME's rigorous monitoring of market conditions and prices in real-time to detect and stop manipulative practices that cause price distortions.

WisdomTree's application gives the same justification as BlackRock's: the company is prepared to enter into a surveillance agreement with a US-based operator in the spot Bitcoin trading area. A second investment firm, Invesco, reportedly resubmitted its application to the SEC for Bitcoin ETF clearance a few hours later.

A request to list the "Invesco Galaxy Bitcoin ETF" on the Cboe BZX exchange was made by Invesco, following BlackRock's lead, in Form 19b-4 filed with the SEC. The petition further underlined that investors would no longer have to rely on poorly regulated offshore firms if they had access to a spot Bitcoin ETF backed by professional custodians and other service providers.

This improvement makes it possible for Bitcoin investors to better protect their capital.

So Far, There Has Been No ETF Approval

Eric Balchunas, a senior ETF analyst at Bloomberg, commented on the current situation as the SEC has yet to approve a spot Bitcoin ETF. Balchunas said that BlackRock's action had resuscitated the ETF competition in response to his tweet on the WisdomTree filing.

Bloomberg's analyst also suggested that bitcoin buyers may have good reason to be optimistic about BlackRock's move. He boasted that the investment firm's success rate in getting ETFs approved by various regulators is "575-1."

Recent developments involving Invesco and WisdomTree are joined by rumors that Fidelity Investments, manager of a staggering $1 trillion, is considering jumping on the bandwagon of institutional spot Bitcoin ETFs.

AP_Abacus, the co-founder of Arch Public, speculated on Twitter on June 19 that Fidelity Investments, which manages over $4.9 trillion in assets, would also soon seek SEC clearance for a spot Bitcoin ETF.

Conclusion

The potential impact of BlackRock's Bitcoin ETF application on the crypto market is significant. If approved, the ETF would likely lead to a surge in institutional investment in Bitcoin, which could drive up the price of the cryptocurrency. Additionally, the ETF would make it easier for retail investors to buy and sell Bitcoin, which could also boost demand for the cryptocurrency.

Read More: Bitcoin Pro Evaluation: Everything You Need To Know

However, it is important to note that the SEC has a history of rejecting Bitcoin ETF applications. In 2017, the SEC rejected two Bitcoin ETF applications from Winklevoss Capital Management and SolidX. The SEC has cited concerns about the volatility of Bitcoin and the lack of a regulated market for the cryptocurrency as reasons for its rejections.
The SEC may approve BlackRock's Bitcoin ETF application. However, it is also possible that the SEC will reject the application. If the SEC rejects the application, it could be a major setback for the crypto market.
Overall, the potential impact of BlackRock's Bitcoin ETF application on the crypto market is significant. If approved, the ETF could lead to a surge in institutional investment in Bitcoin and boost demand for the cryptocurrency. However, it is important to note that the SEC has a history of rejecting Bitcoin ETF applications, so it is not clear if the iShares Bitcoin Strategy ETF will be approved.


DivineMercy

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