BlackRock Sets Sights on US Bitcoin Product
BlackRock, the world's largest asset manager, is aiming to accomplish what many of its competitors have attempted but failed: introducing a Bitcoin product in the United States.
In a recent filing with the SEC, BlackRock outlined its plans for the iShares Bitcoin Trust. To hold the trust’s BTC holdings, BlackRock has chosen Coinbase as the custodian, pending approval from the SEC. It’s worth noting that the SEC recently filed a lawsuit against Coinbase for allegedly operating as an unregistered exchange, a claim that Coinbase denies.
Last year, BlackRock formed a partnership with Coinbase, enabling BlackRock clients to access crypto trading, custody, prime brokerage, and reporting services through Coinbase Prime. By utilizing CF Benchmarks’ Bitcoin reference rate, which gathers price data from various exchanges to ensure consistent spot pricing, BlackRock aims to offer an ETF that feels more familiar and accessible to the 80% of Americans who have yet to own BTC, even though approximately 20% have.
Attempts to launch spot Bitcoin ETFs in the United States have faced continuous challenges. While regulators in other countries have approved investment products directly tied to Bitcoin, the SEC has cited concerns about market manipulation as a reason for blocking such ETFs. However, the SEC has allowed ETFs that invest in BTC futures contracts to enter the market.
After the SEC prevented the company from converting its flagship Bitcoin Trust (GBTC) into an ETF, Grayscale Investments filed a lawsuit against the regulatory body last year. Grayscale argues that the SEC’s rejection of a spot Bitcoin ETF appears arbitrary and capricious, particularly considering the approval of BTC futures-based ETFs.
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David Hirsch, the head of the SEC’s crypto asset and cyber unit, recently stated that potential spot Bitcoin ETF issuers have failed to establish an adequate surveillance system similar to that of registered exchanges. This lack of surveillance is one of the reasons the SEC has been reluctant to approve spot Bitcoin ETFs.
Before collaborating with Coinbase, BlackRock introduced the iShares and Blockchain Tech ETF (IBLC) in April 2022. Despite the fund’s 75% year-to-date growth, its assets under management remain modest at just $7 million after more than a year on the market.
Alexander Stefanov
Reporter at CoinsPress
Alex is an experienced finance journalist and a cryptocurrency and blockchain enthusiast. With over five years of experience covering the industry, he deeply understands the complex and constantly evolving world of digital assets. His insightful and thought-provoking articles provide readers with a clear picture of the latest developments and trends in the market. His passionate approach allows him to break down complex ideas into accessible and insightful content. Follow up on his content to be up to date with the most important trends and topics - stay ahead of the curve with CoinsPress.
