BlackRock Engages with SEC on Bitcoin ETF Structure
In a recent development, BlackRock, the world’s largest asset manager, has once again met with the Securities and Exchange Commission’s (SEC) Trading & Markets division to discuss the structure of its proposed spot Bitcoin Exchange-Traded Fund (ETF).
Initial Meeting and Key Points
The initial meeting between BlackRock and the SEC a week ago centered around the choice between using an “in-kind” redemption model or a cash model for the ETF. The SEC had recommended that applicants for spot Bitcoin ETFs use cash creation, but BlackRock expressed a preference for the in-kind redemption approach.
Details of the Second Meeting
According to Bloomberg ETF analyst Eric Balchunas, the second meeting focused on a proposed regulation modification by NASDAQ Stock Market LLC for listing and trading shares of the iShares Bitcoin Trust. BlackRock presented a revised in-kind model design for redemptions during this meeting.
SEC’s Concerns and BlackRock’s Stance
The SEC has shown apprehension regarding BlackRock’s preference for an in-kind redemption scheme, particularly concerning its impact on the balance sheets and risks to Market Maker’s broker/dealer company in the United States (MM-BD). Despite this, BlackRock is standing firm on its in-kind creation approach.
What Lies Ahead
The ongoing discussions between BlackRock and the SEC, despite their differences, signal that the approval process for the ETF might be advancing. If BlackRock manages to secure regulatory approval for its spot bitcoin ETF, it could significantly impact the market.
As the dialogue continues, the investment and regulatory communities eagerly await the outcome, which could mark a significant milestone in integrating cryptocurrency into mainstream financial products.
Hot Take: BlackRock’s Ongoing Dialogue with SEC on Bitcoin ETF
The ongoing discussions between BlackRock and the SEC about the structure of its proposed spot Bitcoin Exchange-Traded Fund seem to indicate that there may be progress towards regulatory approval. If BlackRock manages to secure approval, it could have a substantial impact on the cryptocurrency market and mark a significant milestone in integrating cryptocurrency into mainstream financial products.
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