BlackRock, the world’s largest asset management firm, has made an amendment to its Bitcoin ETF application, appointing a third-party broker known as a ‘Prime Execution Agent’ to handle the buying and selling of Bitcoin on behalf of the fund. However, this move has raised concerns with the Securities and Exchange Commission (SEC), as the role of the agent in buying Bitcoin under the cash model does not meet the regulator’s standards.
Adding to the regulatory concerns, Coinbase, which was initially named as the custodian for the Bitcoin ETF, is currently involved in a legal battle with the SEC over its operation of an unregistered stock exchange. If Coinbase is used as a third-party broker, tensions between the company and the regulatory agency may increase.
The SEC has also pushed for a redemption technique called “cash create,” which prioritizes cash transactions over ‘in-kind’ techniques using comparable assets. This preference for cash-based procedures has complicated the ongoing debates over approving Bitcoin ETFs.
Despite these uncertainties, the ETF market remains cautiously optimistic. Senior ETF analyst James Seyffart estimates that there is a 90% chance of approval by January 10, 2024. The industry is eagerly anticipating the batch approvals expected in early January.
BlackRock is not solely relying on amendments to its ETF application. The company plans to seed its investment product with $10 million, a significant increase from the original $100,000 seeding in October. This indicates that BlackRock is preparing to release its ETF soon after receiving regulatory permission.
The spotlight on BlackRock’s Bitcoin ETF amendment is just one aspect of a broader landscape. Major financial firms like Fidelity and BlackRock have submitted multiple applications to become spot Bitcoin exchange-traded funds, reflecting the increasing interest in providing real-time exposure to Bitcoin for investors.
Overall, BlackRock’s updated ETF filing demonstrates the company’s commitment to establishing robust operational procedures. This systematic approach ensures a smooth operation once regulatory approval is obtained.
This News Article was automatically generated by Bob the Bot (AI)
| Information | Details |
|---|---|
| Geography | Global |
| Countries | |
| Sentiment | neutral |
| Relevance Score | 1 |
| People | James Seyffart |
| Companies | Bitwise, Coinbase, Fidelity, BlackRock, SEC |
| Currencies | Bitcoin |
| Securities | None |
