- Developments related to BlackRock’s spot Bitcoin ETF have sparked optimism among investors, driving a significant surge in the price of Bitcoin.
- SEC’s ongoing regulatory assessment is a key factor in the timeline for the ETF’s potential launch.
BlackRock, the world’s largest asset manager, is making serious efforts in the process of bringing its spot Bitcoin exchange-traded fund (ETF) to the market. These developments are creating optimism among crypto investors and driving a notable surge in Bitcoin’s price. Let’s take a look at key highlights in the report below:
Ticker Symbol and CUSIP Number Secured
BlackRock has taken a significant step by securing a ticker symbol (IBTC) and a CUSIP number for its upcoming Ishares Bitcoin Trust. These identifiers are essential for the ETF’s regulatory and trading processes.
Listing on DTCC
The Ishares Bitcoin Trust is now listed on the Depository Trust and Clearing Corporation (DTCC), the entity responsible for clearing Nasdaq trades. This listing marks a crucial milestone in the ETF’s journey to the market.
Buying Bitcoin to Seed the ETF
BlackRock’s recent spot Bitcoin ETF filing signals the firm’s intention to purchase Bitcoin to seed its forthcoming ETF this month. This move is part of the standard procedure in the launching of an ETF.
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Seeding the ETF
Eric Balchunas, a senior ETF analyst for Bloomberg, explained that seeding an ETF typically involves providing enough initial capital to get it going. While this doesn’t necessarily mean a substantial Bitcoin purchase, the fact that BlackRock is taking this step is noteworthy.
Balchunas clarified that this action is part of the process of launching the ETF and stated that it’s not necessarily indicative of a large-scale Bitcoin acquisition by BlackRock.
Sponsorship Details
The sponsor of the Ishares Bitcoin Trust is Ishares Delaware Trust Sponsor LLC, which is a Delaware limited liability company and an indirect subsidiary of BlackRock. The filing notes that “Ishares” is a registered trademark of BlackRock Inc. or its affiliates.
The ETF Creation Process
Once approved for registration, the ETF obtains its initial capital from a licensed broker/dealer, such as Coinbase. This capital is then used to purchase the genesis shares, or “creation units,” with raw native Bitcoin. These units are exchanged for IBTC ETF shares, which become available for open-market trading on the first day, determining the ETF’s opening price.
SEC Approval Timeline
Speculation around when the U.S. Securities and Exchange Commission (SEC) might approve BlackRock’s spot Bitcoin ETF has been a topic of discussion. Litigator Joe Carlasare provided insights into the regulatory process. The SEC invited the public to provide feedback on the application, with the comment period ending on October 25th. Subsequently, there’s an additional period for comment review, making it unlikely for a spot ETF to receive approval in 2023.
Bitcoin’s Price Surge
In response to these developments, the price of Bitcoin experienced a significant surge, briefly hitting $35,000 before slightly retracing. At the time of writing, BTC is trading at $34,439, reflecting a 13% increase in the last two days.
Conclusion
BlackRock’s progress in bringing its spot Bitcoin ETF to market has generated excitement in the crypto community. With the acquisition of a ticker symbol, CUSIP number, and its listing on the DTCC, this ETF is taking concrete steps toward becoming a reality. These developments have also influenced Bitcoin’s price, signaling the anticipation surrounding the ETF’s potential launch. While the SEC’s approval timeline remains uncertain, these recent developments are telling us that things are on the right track.
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