The Race for the First Spot Bitcoin ETF Continues
The race to launch the first spot Bitcoin exchange-traded fund (ETF) in the United States is still ongoing. The US Securities and Exchange Commission (SEC) recently revealed the seed funding of some financial giants through its filing.
BlackRock Receives $100,000 in Seed Funding for Spot BTC ETF
In its latest filing on the applications for spot Bitcoin ETFs awaiting approval, the SEC disclosed that an anonymous investor provided $100,000 to BlackRock, the world’s largest asset manager, as part of the company’s seed funding.
The investor agreed to purchase 4,000 BTC ETF shares from BlackRock at $25 per share. This seed capital will support the creation of the units underlying the BTC ETF product and facilitate the provision and trading of shares in the open market.
BlackRock’s Decision to Cover the Sponsor’s Fee
The recent filing also indicated that BlackRock has decided to cover the sponsor’s fee. This means that the firm may borrow cash or Bitcoin as trade credits for a short period from the trade credit lender, without having to sell off any BTC ETF assets. This ensures that BlackRock’s actions do not significantly impact the price of Bitcoin.
Piles of Spot Bitcoin ETF Applications Await SEC Approval
The SEC is yet to approve a spot Bitcoin ETF and has missed deadlines for approving filings throughout 2023. There are currently 13 applications for spot BTC ETFs from major institutional companies.
BlackRock submitted its application in July 2023, and many are optimistic about the regulator’s approval in January 2024. Bloomberg analysts predict a 90% possibility of the SEC approving at least one spot BTC ETF early next year.
Anthony Scaramucci, the founder of SkyBridge Capital, is also positive about the regulator’s approval of a spot Bitcoin ETF in January 2024. He believes that spot BTC ETFs will attract a large sales force comprising tens of thousands of investors. While some ETF applications are approaching their deadline by the beginning of January, the SEC may still deny approval based on technical reasons. The wait for the first spot Bitcoin ETF in the US continues.
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