BlackRock, the world’s largest asset manager, has launched a spot Bitcoin exchange-traded fund (ETF) that is now listed on Nasdaq, the second-largest stock exchange in the world by market capitalization. The fund, called BlackRock Bitcoin Trust (BBT), allows investors to gain exposure to the price of Bitcoin without having to buy, store, or manage the cryptocurrency themselves.
The BBT is different from other Bitcoin ETFs that have been approved by the U.S. Securities and Exchange Commission (SEC) in recent months, such as ProShares Bitcoin Strategy ETF and VanEck Bitcoin Strategy ETF, which are based on Bitcoin futures contracts traded on the Chicago Mercantile Exchange (CME). The BBT is a spot ETF, meaning that it holds actual Bitcoin in custody and tracks its market price directly. This eliminates the need for futures contracts, which can introduce additional costs and risks for investors.
The BBT is also the first Bitcoin ETF to be listed on Nasdaq, which is a major milestone for the cryptocurrency industry. Nasdaq is one of the most influential and innovative stock exchanges in the world, with a reputation for supporting technology and innovation. By listing the BBT on Nasdaq, BlackRock is signaling its confidence in the legitimacy and potential of Bitcoin as an asset class.
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The BBT is expected to attract significant demand from institutional and retail investors who want to access the Bitcoin market in a convenient and regulated way. The BBT has a management fee of 0.95%, which is lower than some of the existing Bitcoin ETFs that charge up to 1.5%. The BBT also benefits from BlackRock’s expertise and reputation as a leading asset manager with over $9 trillion in assets under management.
The launch of the BBT is a positive development for the Bitcoin ecosystem, as it increases the liquidity, accessibility, and adoption of the cryptocurrency. It also demonstrates the growing acceptance and recognition of Bitcoin by mainstream financial institutions and regulators. The BBT could pave the way for more spot Bitcoin ETFs to be approved and listed on other major stock exchanges around the world, creating more opportunities for investors to participate in the Bitcoin revolution.
BLACKROCK IS BUYING BITCOIN AND PREPPING FOR SPOT ETF APPROVAL
BlackRock is moving closer to launching a Bitcoin ETF, evidenced by its iShares Bitcoin Trust appearing on the Depository Trust and Clearing Corporation (DTCC) website. The listing of the fund, which goes by the ticker IBTC, makes it the first proposed spot Bitcoin ETF on DTCC, a financial market giant that handles trillions of dollars in daily transactions.
This listing comes after BlackRock amended its original Bitcoin ETF proposal on October 18. Scott Johnsson, an associate at Davis Polk & Wardwell, pointed out that the amended filing included a CUSIP—a unique identifier necessary for North American securities. The filing also vaguely mentioned that seed creation baskets for the ETF would be purchased in October, subject to certain conditions. That means that Bitcoin is BUYING BITCOIN?? although it may be in small amounts.
The developments at BlackRock are part of a larger trend, as other investment firms like Ark Invest and 21Shares have also updated their Bitcoin ETF applications recently. Ark Invest’s amendments followed discussions with the SEC, further indicating regulatory conversations are taking place. Grayscale is also progressing, registering shares of its existing Bitcoin Trust under the Securities Act of 1933, aiming to eventually convert it into an ETF.
Analysts and legal experts view these developments as signs that the approval of Bitcoin ETFs could be imminent, with BlackRock’s moves seen as particularly bullish. This optimism comes amidst a backdrop of legal developments, like the DC Circuit Court’s recent ruling that criticized the SEC’s rejection of Grayscale’s ETF conversion as “arbitrary and capricious.” The market appears to be responding positively; Bitcoin’s price rose by 10% in the last 24 hours, standing at roughly $34,600 as of press time.
VanEck to donate 10% ETF profit to Protocol Guild
VanEck, one of the leading providers of exchange-traded funds (ETFs) in the US, has announced a new initiative to support the development of decentralized protocols. The company will donate 10% of its net profit from its digital asset’s ETFs to Protocol Guild, a non-profit organization that funds open-source projects in the blockchain space.
According to a press release, VanEck believes that the future of finance is being built on decentralized protocols that offer transparency, efficiency and innovation. The company wants to contribute to this vision by supporting the developers and researchers who are creating these protocols.
Protocol Guild is a community-driven organization that aims to foster the growth and adoption of decentralized protocols. The organization provides grants, mentorship and education to open-source projects that are aligned with its mission. Some of the projects that Protocol Guild has supported include Uniswap, Compound, Aave, MakerDAO and Chainlink.
VanEck’s donation will be based on the net profit from its digital assets ETFs, which include the VanEck Vectors Digital Assets Equity ETF (DAPP) and the VanEck Vectors Bitcoin ETN (VBTC). The donation will be calculated quarterly and distributed to Protocol Guild in the form of cryptocurrencies.
Jan van Eck, CEO of VanEck, said: “We are excited to partner with Protocol Guild and support the development of decentralized protocols. We believe that these protocols have the potential to transform the financial system and create value for investors and society. By donating a portion of our profit from our digital assets ETFs, we hope to contribute to this ecosystem and foster its growth.”
Founder of Protocol Guild said: “We are grateful to VanEck for their generous donation and their commitment to decentralized protocols. We are impressed by their vision and leadership in the digital assets space. Their donation will help us fund more open-source projects and accelerate the adoption of decentralized protocols.”
Novogratz thinks bitcoin ETFs will be approved this year.
One of the most prominent figures in the cryptocurrency industry, Mike Novogratz, has expressed his optimism that the US Securities and Exchange Commission (SEC) will finally approve bitcoin exchange-traded funds (ETFs) this year. Novogratz, who is the founder and CEO of Galaxy Digital, a crypto-focused investment firm, shared his views in an interview with Bloomberg TV on October 22.
Novogratz said that he believes the SEC is under pressure to greenlight bitcoin ETFs, as more and more institutional investors are showing interest in the digital asset class. He also pointed out that Canada and other countries have already launched successful bitcoin ETFs, which could serve as a model for the US regulators.
“I think the SEC is feeling the heat. They’re seeing that this is a real asset class, that institutions want access to it, that there’s a lot of innovation happening around it,” Novogratz said. “And they’re seeing that the rest of the world has moved ahead of them.”
Novogratz added that he expects the SEC to approve bitcoin futures ETFs first, as they are based on regulated contracts traded on the Chicago Mercantile Exchange (CME). He said that these products would be a “big step forward” for the crypto industry, as they would provide more liquidity and price discovery for bitcoin. He also predicted that the SEC would eventually approve bitcoin spot ETFs, which would track the actual price of bitcoin on spot exchanges.
“I think we’ll get futures ETFs first, and then we’ll get spot ETFs. And I think both of those will be very, very bullish for the space,” Novogratz said.
Novogratz is not alone in his bullish outlook for bitcoin ETFs. Several analysts and experts have also expressed their confidence that the SEC will approve bitcoin ETFs in the near future, citing the growing demand and maturity of the crypto market.
Some of the factors that could influence the SEC’s decision include the appointment of Gary Gensler as the new SEC chairman, who is known to be more knowledgeable and open-minded about crypto than his predecessors; the launch of several crypto-related products by mainstream financial institutions, such as Morgan Stanley, Goldman Sachs, and Fidelity; and the increasing adoption of bitcoin by corporations, such as Tesla, MicroStrategy, and Square.
Bitcoin ETFs are seen as a game-changer for the crypto industry, as they would lower the barriers to entry and increase the exposure of bitcoin to a wider range of investors, especially those who are reluctant or unable to buy and store bitcoin directly. Bitcoin ETFs would also provide more legitimacy and credibility to bitcoin as a legitimate asset class, which could boost its price and adoption.