The Blackrock Spot Bitcoin ETF
Blackrock, a well known asset manager, has filed for a spot bitcoin ETF. This is news because it can help to pump bitcoin’s price.
Many people in cryptoland continue to search high and low for signs of hope and progress in crypto asset prices. The firm is going to do things a little differently. In addition to working with SEC as others have tried to gain regulatory approval for this spot Bitcoin ETF, it will also have a few differences in its application.
One of these differences is that it will work with Nasdaq to implement a surveillance sharing agreement. This part of the application indicates further seriousness in bringing about transparency in the market. This component of the application should also help to mitigate market manipulation.
A key point that critics of this aspect put into a filing state is that since the blockchain is already transparent, it is not necessary to have a surveillance sharing agreement. These experts note that the respective government body will have the ability to access all of the information by looking at the data feeds that are already public. If they sense some issues and notice what could be market manipulation, then they could specifically into those trades.
Further, many of the most prominent exchanges already conduct KYC and seek to comply with AML requirements. As such, they should already have a profile of the individual who made the trade. This profile would have the person’s real name, their location (through their government issued ID) and other relevant information that would help to find out the people behind specific manipulative trades.
Further Concerns with A Blackrock Spot Bitcoin ETF
The Blackrock Spot Bitcoin ETF also brings about different concerns. A primary concern is what is the extent of control that Black Rock would have on bitcoin?
The value of bitcoin is that it is supposed to be peer to peer, decentralized, and scarce. Individuals wonder if the Black Rock will be able to gain further bitcoin related assets over time as other entities are shunned and Black Rock is blessed by the relevant regulatory bodies.
Preston Pysh had a great tweet that summarizes primary concerns “I’m sorry, but after watching, Blackrock, Fidelity, Citadel, Schwab and now Deutsche Bank, all apply for #Bitcoin ETFs, spot exchanges, etc. only a few days after the SEC drops a TRO on Binance and sues Coinbase… how can’t you think this entire past year was a giant inside job coordinated between the Wall Street parasites & government regulators so they could catch-up…”
The Institutions Are Finally Coming?
The excitement continues to be over the potential institutional demand. The thinking is as such, institutions would be able to purchase ETFs, have ample liquidity to move in and out of bitcoin investments, and would continue to add value to the sector.
It is an interesting move as it would certainly help to “legitimize” the investment class in the eyes of doubters. It would be even more interesting for this ETF to come to life in this present time. Binance seems to be feeling the squeeze globally, Coinbase is fighting with the SEC, and we just went through the SBF/FTX drama. Oh, I almost forgot the banks who favored cryptocurrency entities going bankrupt as well.
But even more ironic is that Blackrock will choose Coinbase as its custodial partner.
That’s right, Coinbase, a firm that is currently in battle with the SEC.
Does that mean that Blackrock thinks that Coinbase will be able to win and come out stronger on the other side of the legal battle that it is in with the SEC? If that is the case, then maybe Coinbase is undervalued? Or at least Coinbase should have brighter days ahead? These truly are interesting times in cryptoland.