BlackRock, the world’s largest money manager with $9 trillion in assets under management, has filed an application with the US Securities and Exchange Commission (SEC) to offer a spot bitcoin exchange-traded fund (ETF). If approved, it would become the first publicly traded spot bitcoin ETF in the US and would trade on the Nasdaq stock market. BlackRock already operates a private spot bitcoin trust, and the ETF represents an expansion of its partnership with Coinbase, which would serve as the custodian for the fund’s bitcoin holdings.
The launch of a spot bitcoin ETF by BlackRock could provide a boost to cryptocurrencies, which have faced recent challenges such as the collapse of FTX and regulatory actions against Coinbase and Binance. However, the approval of the application by the SEC is uncertain. The SEC has previously rejected proposals for similar ETFs due to concerns about unregulated exchanges and market manipulation risks associated with cryptocurrencies.
BlackRock’s move comes at a time when the SEC is proposing new custody rules that would impose additional responsibilities on asset managers to ensure proper segregation of customer assets. Despite the price of bitcoin being down over 60% from its 2021 peak, BlackRock’s interest in cryptocurrencies signals ongoing engagement from major financial institutions. The proposed ETF aims to offer a more familiar and accessible option for the majority of Americans who have not yet invested in bitcoin.
BlackRock has declined to comment on the filing, but the company’s founder, Larry Fink, has previously acknowledged the interesting developments in the digital asset space. BlackRock’s investor day highlighted its focus on launching new ETFs and expanding its offering across various asset classes, with a current portfolio of over 1,300 different ETFs.