BlackRock, the world’s largest asset manager with a portfolio worth approximately $9 trillion, has indicated that its Bitcoin ETF application is close to approval by the US Securities and Exchange Commission, the SEC, a historic milestone in the cryptocurrency industry. market.
The approval signals growing institutional interest in digital assets, especially from a financial giant like BlackRock, often referred to as “the owner of the world.”
The fund, once approved, will enable traditional investors to gain exposure to Bitcoin in a regulated and more trusted way.
According to recent documents, BlackRock plans to buy $10 million worth of Bitcoin on January 3, 2024, to mark the 15th anniversary of the mining of Bitcoin’s genesis block, a symbolic event in the history of the world’s largest cryptocurrency.
This move is not only a vote of confidence in Bitcoin as a valuable asset, but also a tribute to its history and impact on the financial world.
Owner of the World” will launch Bitcoin ETF
In October this year, BlackRock carried out a major financial transaction in which a subsidiary of the company acquired 4,000 shares at a price of $25 each, for a total of $100,000.
These shares were later converted into 400,000 shares through “Seed Creation Baskets”, worth $10 million. This money was then used to purchase Bitcoin, according to documents filed with the SEC.
BlackRock’s strategy is not just a financial move, but also a way to validate Bitcoin as an investable asset in the eyes of more traditional investors.
The entry of an institution of BlackRock’s caliber into the market could serve as a catalyst for greater institutional adoption and regulatory acceptance of cryptocurrencies.
The SEC’s ETF approval process is a crucial aspect of the journey. The SEC, which recently held a meeting with several Bitcoin ETF applicants, is requiring trades to be executed in cash, which is a point of contention for many applicants.
However, BlackRock adapted to this requirement, increasing the likelihood of approval.
Although adding a layer of inefficiency to the process, this approach is seen as a necessary step to moving forward in the current regulatory environment. It is expected that BlackRock’s ETF, once approved, could open the doors to other similar products, increasing liquidity and market stability.
The potential impact of a Bitcoin ETF is significant. It is estimated that only 1% to 10% of the assets managed by BlackRock and other similar entities can be allocated to Bitcoin through their various ETF vehicles, in addition to their own spot ETFs.
This could mean significant capital inflows into the market, potentially increasing its market capitalization and price.
BlackRock’s entry into the cryptocurrency market with its ETF signals a significant change in the global financial landscape. It represents the acceptance of Bitcoin as a legitimate asset by one of the world’s largest financial institutions and signals greater institutional adoption that could have far-reaching implications for the future of Bitcoin and cryptocurrencies as a whole.
Source: Live Coins
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.
