BlackRock challenges SEC with Bitcoin spot ETF application

As the cryptocurrency industry comes under intense scrutiny from the Securities and Exchange Commission (SEC), the world’s largest asset manager, BlackRock, continues to deploy financial tools. It’s getting in on the action by filing an application to launch a Bitcoin spot ETF with Coinbase as an ally. This bold move could well upend cryptocurrency regulation in the US.

BlackRock files for registration with the SEC for a Bitcoin ETF

The American multinational asset management company, BlackRock, surprises by filing an application for registration with the Securities and Exchange Commission (SEC) for its Bitcoin spot ETF called iShares Bitcoin Trust. This move comes at a time when the cryptocurrency industry in the U.S. is facing regulatory challenges related to alleged violations of securities laws.

If the iShares Bitcoin Trust from BlackRock is approved, it will then offer U.S. investors easy and secure participation in the Bitcoin market.

It should be noted that this is not the first attempt to register a Bitcoin ETF with the SEC. According to Bloomberg, this is the 33rd attempt of its kind. To date, all previous requests have been rejected. by regulators, citing a lack of investor protection.

Only BTC ETFs based on Chicago Mercantile Exchange futures contracts have won SEC approval. However, the entry of BlackRock, the world’s largest asset manager with nearly $8,487 billion in assets under management, could prompt the SEC to reassess its arguments and open the way for institutional investors.

Coinbase: A major ally

The iShares Bitcoin Trust is designed to closely track changes in the price of Bitcoin. This newly created ETF will be valued using indices provided by CF Benchmarks, which aggregates data from six major stock exchanges, including :

  • Coinbase
  • Kraken
  • Gemini
  • Bitstamp
  • itBit
  • LMAX Digital

BlackRock searching for a secure custody solution for its assets, turned to Coinbase, a company with which he has a long-standing relationship.

Thanks to this partnership aimed at facilitating access to cryptocurrencies for institutional clients, BlackRock has chosen Coinbase Custody.

Thus, Coinbase Custody will act as custodian for this fund, while the information provided by the Coinbase will be used to determine the value of the ETF.

This strategic choice may seem bold, especially as it is based on the recognition and credibility enjoyed by BlackRock with US regulators. However, it should be noted that the presence of Coinbase could raise doubts, given that this exchange platform maintains strained relations with the SEC. The announcement of this move has had a positive impact on the price of Bitcoin, which is up 5% at the time of writing.