BlackRock Makes Changes to Bitcoin ETF Application to Attract Wall Street Banks
Asset management giant BlackRock has revised its application for a Bitcoin ETF to make it more appealing to Wall Street banks. The updated version allows for the creation of new shares using cash instead of just cryptocurrency. It also allows banks to act as authorized participants for the ETF, bypassing current restrictions that prevent them from holding Bitcoin directly. The revised model was presented to the SEC by members of BlackRock and Nasdaq. Under this model, authorized participants transfer cash to a broker-dealer, who then converts it to Bitcoin and stores it with Coinbase Custody. BlackRock believes the new structure offers better protection against market manipulation and strengthens investor protections.
BlackRock’s Bitcoin ETF Could Lead to Trillion-Dollar Inflows
If approved, BlackRock’s new Bitcoin ETF model could result in a significant increase in investment inflows. This model allows trillion-dollar Wall Street banks to participate without directly exposing themselves to cryptocurrency, which is currently prohibited. By making it easier for banks to participate, the revised model aims to attract more institutional investors to the crypto market. The SEC must make a decision on BlackRock’s application by January 15, with the final deadline set for March 15. Analysts predict that the SEC may reveal their decision on several pending applications between January 5-10.
Hot Take: BlackRock’s Revised Bitcoin ETF Application Could Accelerate Institutional Adoption
BlackRock’s decision to revise its Bitcoin ETF application to make it more accessible to Wall Street banks is a significant development for the crypto market. By allowing banks to participate without holding Bitcoin directly, the revised model addresses one of the major concerns of regulators regarding market manipulation. If approved, this could open the floodgates for trillion-dollar banks to invest in cryptocurrency and potentially lead to a substantial increase in investment inflows. The move represents a step towards mainstream adoption of Bitcoin and other cryptocurrencies by institutional investors, signaling a shift in the perception of digital assets as a legitimate investment asset class.
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