BlackRock, the world’s largest manager of assets, filed for a bitcoin exchange-traded fund (ETF) on Thursday, which would provide investors exposure to the digital currency as the asset class comes under heavy regulatory scrutiny.
In accordance with a filing with the U.S. Securities and Exchange Commission (SEC), BlackRock’s iShares Bitcoin Trust will use Coinbase Custody as its custodian. No applications for spot bitcoin ETFs have been approved by the US regulator as of yet.
For institutional clients in the US, BlackRock introduced a spot bitcoin private trust last year.
The action is being taken at a time when the U.S. securities regulator is allegedly targeting the worldwide cryptocurrency business for alleged violations of securities laws.
The government filed high-profile litigation against prominent exchanges Coinbase and Binance earlier this month, which rippled throughout the digital assets sector.
BlackRock is a reputable and well-established asset management organization. According to Joshua Chu, group chief risk officer at blockchain technology group XBE, Coinllectibles, and Marvion, BlackRock’s filing for a Bitcoin ETF might be considered as a positive development in the hunt for regulatory clearance.
It also demonstrates the public’s interest in cryptocurrencies remains strong.
A spot bitcoin ETF would monitor the underlying market price of the cryptocurrency. An ETF, according to supporters, would give investors exposure to bitcoin without requiring them to buy it directly.
The application by Grayscale Investment LLC to turn its flagship product, the Grayscale Bitcoin Trust, into an ETF was denied by the SEC last year.
Asserting that the SEC was acting arbitrarily by denying requests for spot bitcoin ETFs while previously approving requests for bitcoin futures ETFs, Grayscale filed a lawsuit against the agency.
Additionally, proposals for spot bitcoin ETFs from companies including Fidelity, Cboe Global Markets, and NYDIG were rejected by the SEC.
After the news was out, the price of bitcoin increased by 2%. On Friday, they were last at $25,506. In the year, the biggest cryptocurrency has increased by 54%.
