Blackrock has revealed a plan to seed its spot bitcoin exchange-traded fund (ETF) with $10 million on Jan. 3. The world’s largest asset manager has engaged in six recent meetings with the U.S. Securities and Exchange Commission (SEC) to address its filing. In response to the SEC’s concerns, the firm has opted for the cash creation model, departing from its initial preference for the in-kind model.
Blackrock Amends Spot Bitcoin ETF Filing After 6 Meetings With SEC
Blackrock, the world’s largest asset manager, filed an amendment to its registration statement (S-1) for a spot bitcoin exchange-traded fund (ETF) with the U.S. Securities and Exchange Commission (SEC) on Friday. The firm disclosed that it plans to seed Ishares Bitcoin Trust with $10 million on Jan. 3, 2024.
The amendment details that the seed capital investor, an affiliate of the trust’s sponsor, purchased seed shares worth $100,000 for the spot bitcoin ETF on Oct. 27, subject to conditions. The filing also outlines the redemption of seed shares for cash and the purchase of seed creation baskets worth $10 million by the seed capital investor on Jan. 3, 2024.
Bloomberg analyst James Seyffart remarked on social media platform X Friday that Blackrock has submitted an updated/amended S-1 form following discussions with the SEC the day before regarding its spot bitcoin ETF filing. The analyst wrote:
Looking like Blackrock is *planning* to make moves on Jan 3rd. They’re seeding the ETF with $10 million.
He further speculates that it could mean that Blackrock is expecting to launch its spot bitcoin ETF “shortly after.” Once launched, the Ishares Bitcoin Trust will trade under Ticker IBIT.
Another Bloomberg analyst Eric Balchunas commented on X that Blackrock expecting to seed its spot bitcoin ETF with $10 million on Jan. 3 is “a pretty big bump up” from the $100K the asset manager seeded in October.
Balchunas also highlighted that the SEC wants authorized participants (APs) named in the filers’ upcoming S-1 updates, giving them 10 days to submit. The analyst speculates that the securities regulator aims to approve applicants who have included the AP agreement in their amended filings and have adopted the cash creation model. He stated on X:
This is no easy last step, and may keep some from starting gate. AP agreement + cash creates = approval.
Blackrock has held meetings with the SEC more times than other spot bitcoin ETF applicants over the past month. The asset manager met with the SEC on Nov. 20, Nov. 28, Dec. 11, Dec. 14, Dec. 19, and Dec. 21. Blackrock also filed three amendments to its spot bitcoin ETF filing in December.
The world’s largest asset manager initially sought approval from the securities regulator for the use of an in-kind method. Failing to persuade the SEC with a revised in-kind model, Blackrock opted to embrace the cash model for its spot bitcoin ETF. The deadline for the first spot bitcoin ETF approval is Jan. 10, and some anticipate the SEC approving multiple spot bitcoin ETFs by that date, including Galaxy Digital CEO Mike Novogratz.
What do you think about Blackrock planning to seed its spot bitcoin ETF with $10 million on Jan. 3? Do you think the SEC will approve spot bitcoin ETF filings before Jan. 10? Let us know in the comments section below.
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