BlackRock is taking steps towards the potential launch of its spot Bitcoin exchange-traded fund (ETF). The Wall Street behemoth received $100,000 as seed capital for its proposed BTC spot vehicle, according to a filing yesterday.
BlackRock Seeded Its Spot ETF With $100K In October
BlackRock, the world’s biggest asset manager, received $100,000 in capital from an unknown investor who purchased shares from the iShares Bitcoin Trust on October 27, a fresh filing with the U.S. Securities and Exchange Commission (SEC) indicates.
“The seed capital investor agreed to purchase $100,000 in shares on October 27, 2023, and on October 27, 2023 took delivery of 4,000 shares at a per-share price of $25.00 (the “seed shares”),” the filing reads.
The investor, as per the application, acts “as a statutory underwriter with respect to the Seed Creation Baskets.” A seed capital investor initially funds an ETF to get it off the ground and allow shares to get traded in the open market. Notably, seeding doesn’t normally involve a vast sum of money, which would explain why BlackRock’s ETF received $100K.
A spot crypto ETF has yet to go live in the U.S. as the SEC has always denied applications for such products, often citing market manipulation concerns as the main reason.
But BlackRock shocked the world in June after filing paperwork to launch its own exchange-traded fund that holds BTC. It is not much of an exaggeration to state that the investment giant’s surprising application reignited interest in a bitcoin trading vehicle that many in the crypto industry thought was a lost cause.
Bloomberg Intelligence analyst Eric Balchunas described the new seed capital revelations as an interesting development “in the nerdiest way”.
All Eyes On January
The SEC’s reluctance to approve a spot bitcoin ETF has been a sore point for would-be applicants. Grayscale Investments, for instance, sued the regulator, claiming it had been unfair to reject its application to transform the GBTC into an ETF.
There have been positive signs that Grayscale has been making some progress. In August, a judge determined that the SEC should accept the firm’s application. In October, it became clear the SEC didn’t intend to appeal the decision and was thus ordered to officially reassess the ETF proposal.
The SEC is set to decide on whether or not to greenlight one or more spot bitcoin ETFs between Friday, January 5 and Wednesday, January 10 — which will be the next and last deadline. Bloomberg analysts predict there is a 90% chance that the SEC will approve a spot Bitcoin ETF for trading in January.