Asset management giant BlackRock has made a major change to its spot Bitcoin exchange-traded fund (ETF) proposal. This review could be key to U.S. Securities and Exchange Commission approval, a crucial step for BlackRock to become the first ETF of its kind to enter the U.S. market.
Money rescue: a smart move
BlackRock has decided to move to a cash redemption mechanism in its ETF proposal. According to several experts, this is a smart move as this model is preferred by the SEC. BlackRock’s original approach, which focused on redemptions, is now off the table. The new model replaces ETF shares with cash value, which is considered a safer and more accessible option for investors.
The SEC had previously raised concerns about BlackRock’s original proposal, particularly regarding investor safety and the potential risks of market manipulation. The move to a cash redemption model is therefore a response to these concerns and could significantly increase the BlackRock ETF’s chances of approval.
A trend among asset managers
BlackRock isn’t the only company making this strategic change. Several asset managers, including ARK 21Shares, have made similar adjustments to their ETF proposals. It appears that these companies recognize that alignment with SEC preferences is critical to the approval of their ETFs.
What does this mean for the future?
This development from BlackRock and other asset managers is a clear sign that the race to launch the first Bitcoin ETF in the US is in full swing. With this new approach, they hope to gain approval from the SEC, which has proven to be a major challenge for many companies. Adapting your proposals to a cash reimbursement model could be the key element that makes the difference.
The approval of a Bitcoin spot ETF would be a major milestone in the acceptance of cryptocurrencies in the traditional financial world. This would not only give investors a new way to invest in Bitcoin, but it would also open the door for more adoption and innovation in the financial sector.
It is not yet clear when the SEC will provide a result. This is expected to happen in January 2024, but the SEC itself has not yet commented on the matter.
Source: BTC Direct
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Barry Siefert is an accomplished journalist and author at The Nation View. He is known for his expertise in the field of cryptocurrency, and has written extensively on the topic. With a background in finance and economics, Barry has a deep understanding of the underlying technology and market forces that drive the crypto industry.
