Asset management giant BlackRock has taken a significant step towards launching a spot bitcoin exchange-traded fund (ETF) by filing an application with the U.S. Securities and Exchange Commission (SEC). The proposed iShares Bitcoin Trust would provide investors with easy access to cryptocurrency through a product offered by one of Wall Street’s largest companies. The filing emphasized that the ETF would serve as a means of investing in bitcoin without directly acquiring or trading the digital asset. The SEC has previously resisted approving a spot bitcoin ETF in the United States, currently engaged in a legal battle with Grayscale over its conversion of the Grayscale Bitcoin Trust into an ETF.
While BlackRock’s move is a positive development for the crypto ETF space, it is expected to face resistance from the SEC, and the filing may be withdrawn before an ETF is launched. The application comes at a time when cryptocurrency prices remain below their all-time highs, and the industry is facing increased scrutiny from regulators. The SEC recently sued Coinbase and Binance for alleged violations, including operating unregistered securities exchanges and commingling customer funds.
Coinbase is listed as the bitcoin custodian for BlackRock’s proposed ETF, with the two companies having a strategic partnership. BlackRock’s entry into the bitcoin ETF space could potentially boost a sector that has faced challenges since the launch of bitcoin futures ETFs in 2021, with the ProShares Bitcoin Strategy ETF being the only one to achieve substantial growth.
BlackRock already offers the iShares Blockchain and Tech ETF, an equity fund related to crypto, but it has seen limited asset accumulation since its launch over a year ago. The SEC has yet to respond to the new filing by BlackRock.